Car Biz Today | February 2016

CAR BIZ TODAY

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The Official News Source Of The Retail Automotive Industry

FEBRUARY 2016

Entire contents ©2016 Car Biz Today. All Rights Reserved.

VOLUME 3, ISSUE 2

HOW MUCH IS DOWNTIME COSTING YOU? ERIK NACHBAHR … see PAGE 20

USE DATA FOR A TARGETED STRATEGY AMY FARLEY … see PAGE 18

PRE-SCREEN FOR CREDIT WORTHINESS JOHN GIAMALVO … see PAGE 12

JUDGING YOUR SALES TEAM EFFECTIVENESS JOHN FAIRCHILD

PRSRT STD US POSTAGE PAID Permit No. 1459 Pewaukee, WI

… see PAGE 36

Jimmy Berg President/Owner, Sunrise Toyota

HOW A REDESIGN HELPED SALES AND EMPLOYEE SATISFACTION Upgrades in Service Department Key ... see PAGE 24

THE YEAR OF THE CALL Sales are on the line, are you answering?

CBT NEWS 5 Concourse Parkway Suite 100 Atlanta, GA 30328

... see PAGE 47

JOIN THE NATION’S LEADING TECH-ENABLED MARKETING COMPANY. VISIT THE ALL NEW

Magazine archived at www.cbtnews.com.

FORCEMKTG.COM

STRIKE A CHORD. STRIKE A CONVERSATION. STRIKE A SALE. Every market strums to a different tune.

Autotrader provides unique local market insights that keep you steps ahead of the competition, helping you sell more cars.

B:14.75”

S:14”

T:14.5”

BEHIND EVERY PASSIONATE CUSTOMER is a dealer who loves the car business.

For a chance to win your very own #lovethecarbusiness documentary, register at

www.lovethecarbusiness.com

Get to know the new Autotrader at AGame.Autotrader.com

and don’t forget to stop by CBT Automotive Conference & Expo booth #309 on Feb.9-11 in Atlanta, GA.

DIGITAL MARKETING SOLUTIONS // SHOPPER INSIGHTS // LOCAL MARKET GUIDANCE

©2015 Autotrader.com, Inc. All Rights Reserved. Autotrader is a registered trademark of TPI Holdings, Inc. used under exclusive license.

© 2016 Automobile Protection Corporation-APCO. EasyCare is a registered trademark of Automobile Protection Corporation-APCO.

STRIKE A CHORD. STRIKE A CONVERSATION. STRIKE A SALE. Every market strums to a different tune.

Autotrader provides unique local market insights that keep you steps ahead of the competition, helping you sell more cars.

B:14.75”

S:14”

T:14.5”

BEHIND EVERY PASSIONATE CUSTOMER is a dealer who loves the car business.

For a chance to win your very own #lovethecarbusiness documentary, register at

www.lovethecarbusiness.com

Get to know the new Autotrader at AGame.Autotrader.com

and don’t forget to stop by CBT Automotive Conference & Expo booth #309 on Feb.9-11 in Atlanta, GA.

DIGITAL MARKETING SOLUTIONS // SHOPPER INSIGHTS // LOCAL MARKET GUIDANCE

©2015 Autotrader.com, Inc. All Rights Reserved. Autotrader is a registered trademark of TPI Holdings, Inc. used under exclusive license.

© 2016 Automobile Protection Corporation-APCO. EasyCare is a registered trademark of Automobile Protection Corporation-APCO.

CAR BIZ TODAY M

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Letter from the editor Dear readers, We at CBT Automotive News have been like kids waiting for Santa to show up. For months we have planned an excited, impactive conference and expo sponsored by CBT Car Biz Today with Autotrader, ELead1One and EasyCare. And, it’s finally here!! So many icons in the automotive business and inspirational fields are all coming together to bring their insights, data, stories and advice.

What is so unique about this conference is not only wide range of topics covered, but that participants can be involved in any of the 65 dynamic breakout sessions so they can drill down into issues facing their dealerships and businesses. It’s a rare opportunity and

MARY WELCH

we are not only excited to offer it to our readers and advertisers but to sit back and learn

Managing Editor

ourselves. I’m sure we’ll get a lot of fantastic stories out of the conference.

We also hope you enjoy this issue. We profile Jimmy Berg of Sunrise Toyota on Long Island who spent $10 million to upgrade his facility and kept not only his customers but his employees in mind when designing it. In the competitive labor market Berg took a note from Field of Dreams and said that if he built the best service area on Long Island, top technicians will come and stay. They did — and they are.

We also have a great story by Mike Haeg on how your smartphone can bring in business — or turn it away. John Fairchild writes about how to judge your team’s sales skills and how to bring them up to the proper levels. There are many more relevant, targeted and insightful stories that we hope you enjoy.

It’s a Leap Year, which gives everyone an extra day to make a sale and bring smiles to customers’ faces. Let’s make it happen!

Mary Welch How did your Finance & Insurance departments do?

By Tony Dupaquier, Academy of Service Group

8

Millennials’ growing buying power should be courted

By Jody Devere, AskPatty.com

Right financial pre-screen aids revenue stream

By John Giamalvo, Equifax

14

for IT downtime and now fix it

By Erik Nachbar, Helton Technologies

24 Association News 26 Dealer Profile: Sunrise

By Jon McKenna

28

The importance of aligning employee and management cultures

By Michael Roppo, Automotive Domain Results

16

Ask the Pros

18

You have lots of data at your fingertips. Now use it!

dealer’s best — and worst — friend

CBTNews.com

By Todd Marcelle, GoMoto

30 Customers have caught on

By Russ Chandler, PERQ LLC

32 CBT News

20 The Smartphone is a

By Mike Haeg, Century Interactive

Find out how one dealer used technology to better customer experiences

to mousetrap strategy

By Amy Farley, Force Marketing

4

22 There are lots of reasons

Toyota’s $10 million focuses on service and amenities

10 Industry News 12

Email newsroom@cbtnews.com Phone 678.221.2955

DON’T MISS THE PREMIERE AUTOMOTIVE EVENT OF 2016 FEBRUARY 9-11, 2016 | OMNI HOTEL AT CNN CENTER | ATLANTA

President And Publisher Jim Fitzpatrick Vice President/COO Bridget Fitzpatrick Managing Editor Mary Welch Creative Director Randall Veugeler Art Director Erica Abrams Production Manager Laura Payne Designers Shay Harbaugh Brian Hassinger April Miller Christina Zavlanos Creative Director - Digital Michael Marley Director of Marketing & Events Karen Locadia Marketing Associate Erin Mumphord

In This Issue 6

CAR BIZ TODAY MAGAZINE

34

A Q&A on what skills successful GMs need

By Glenn Pasch, PCG Digital Marketing

CAR BIZ TODAY FEBRUARY 2016

36

Subscription Manager Emily Wiggins

50 Years of Women, Cars and cultural shifts

By Anne Fleming, Women-Drivers.com

ADVERTISING Director of Sales Gary Blitzer gblitzer@cbtnews.com d 678.221.2955 c 770.330.6821

38 Changes in co-op spending differs among OEMs, dealers and associations

By Gary Galloway, Netsertive

By Chip Walker, Custom Facilities Inc.

42 Judging your team’s sales skills and fixing them.

By John Fairchild, FairchildAutomotivessolutions.com

44 On the set with CBT

Automotive Network

TECHNOLOGY ▪

MARKETING

OVER 65 DYNAMIC BREAKOUT SESSIONS Inspire confidence, loyalty and hard work with key LEADERSHIP lessons from Nick

CUSTOMER SERVICE info@cbtnews.com

40 Proper waiting rooms can bring in new clients and dollars

LEADERSHIP ▪ MANAGEMENT ▪

SUBSCRIPTIONS To subscribe electronically, log on to cbtnews.com and click the subscribe link on the side bar. Alternately, forward your company name, your name, address, phone number and email address to info@cbtnews.com or CBT News, 5 Concourse Parkway, Atlanta, GA 30328.

Please send address changes to the above email or mailing address.

Permission to reprint or quote excerpts granted only upon written request.

Advertising rates are provided upon request.

Saban, Patrick Lencioni and many others.

Gain valuable MANAGEMENT skills to “Win in Business” with Marcus Lemonis and panel discussions from industry trailblazers.

Learn innovative and groundbreaking solutions to advance TECHNOLOGY and efficiency in your dealership with dedicated sessions from leading experts.

Accelerate your MARKETING efforts and stand out from the crowd with insider secrets from Jason Dorsey and proven digital techniques and tools from the best in the business.

C BTCO N F ER EN C EA N D EX P O.CO M

CAR BIZ TODAY M

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Letter from the editor Dear readers, We at CBT Automotive News have been like kids waiting for Santa to show up. For months we have planned an excited, impactive conference and expo sponsored by CBT Car Biz Today with Autotrader, ELead1One and EasyCare. And, it’s finally here!! So many icons in the automotive business and inspirational fields are all coming together to bring their insights, data, stories and advice.

What is so unique about this conference is not only wide range of topics covered, but that participants can be involved in any of the 65 dynamic breakout sessions so they can drill down into issues facing their dealerships and businesses. It’s a rare opportunity and

MARY WELCH

we are not only excited to offer it to our readers and advertisers but to sit back and learn

Managing Editor

ourselves. I’m sure we’ll get a lot of fantastic stories out of the conference.

We also hope you enjoy this issue. We profile Jimmy Berg of Sunrise Toyota on Long Island who spent $10 million to upgrade his facility and kept not only his customers but his employees in mind when designing it. In the competitive labor market Berg took a note from Field of Dreams and said that if he built the best service area on Long Island, top technicians will come and stay. They did — and they are.

We also have a great story by Mike Haeg on how your smartphone can bring in business — or turn it away. John Fairchild writes about how to judge your team’s sales skills and how to bring them up to the proper levels. There are many more relevant, targeted and insightful stories that we hope you enjoy.

It’s a Leap Year, which gives everyone an extra day to make a sale and bring smiles to customers’ faces. Let’s make it happen!

Mary Welch How did your Finance & Insurance departments do?

By Tony Dupaquier, Academy of Service Group

8

Millennials’ growing buying power should be courted

By Jody Devere, AskPatty.com

Right financial pre-screen aids revenue stream

By John Giamalvo, Equifax

14

for IT downtime and now fix it

By Erik Nachbar, Helton Technologies

24 Association News 26 Dealer Profile: Sunrise

By Jon McKenna

28

The importance of aligning employee and management cultures

By Michael Roppo, Automotive Domain Results

16

Ask the Pros

18

You have lots of data at your fingertips. Now use it!

dealer’s best — and worst — friend

CBTNews.com

By Todd Marcelle, GoMoto

30 Customers have caught on

By Russ Chandler, PERQ LLC

32 CBT News

20 The Smartphone is a

By Mike Haeg, Century Interactive

Find out how one dealer used technology to better customer experiences

to mousetrap strategy

By Amy Farley, Force Marketing

4

22 There are lots of reasons

Toyota’s $10 million focuses on service and amenities

10 Industry News 12

Email newsroom@cbtnews.com Phone 678.221.2955

DON’T MISS THE PREMIERE AUTOMOTIVE EVENT OF 2016 FEBRUARY 9-11, 2016 | OMNI HOTEL AT CNN CENTER | ATLANTA

President And Publisher Jim Fitzpatrick Vice President/COO Bridget Fitzpatrick Managing Editor Mary Welch Creative Director Randall Veugeler Art Director Erica Abrams Production Manager Laura Payne Designers Shay Harbaugh Brian Hassinger April Miller Christina Zavlanos Creative Director - Digital Michael Marley Director of Marketing & Events Karen Locadia Marketing Associate Erin Mumphord

In This Issue 6

CAR BIZ TODAY MAGAZINE

34

A Q&A on what skills successful GMs need

By Glenn Pasch, PCG Digital Marketing

CAR BIZ TODAY FEBRUARY 2016

36

Subscription Manager Emily Wiggins

50 Years of Women, Cars and cultural shifts

By Anne Fleming, Women-Drivers.com

ADVERTISING Director of Sales Gary Blitzer gblitzer@cbtnews.com d 678.221.2955 c 770.330.6821

38 Changes in co-op spending differs among OEMs, dealers and associations

By Gary Galloway, Netsertive

By Chip Walker, Custom Facilities Inc.

42 Judging your team’s sales skills and fixing them.

By John Fairchild, FairchildAutomotivessolutions.com

44 On the set with CBT

Automotive Network

TECHNOLOGY ▪

MARKETING

OVER 65 DYNAMIC BREAKOUT SESSIONS Inspire confidence, loyalty and hard work with key LEADERSHIP lessons from Nick

CUSTOMER SERVICE info@cbtnews.com

40 Proper waiting rooms can bring in new clients and dollars

LEADERSHIP ▪ MANAGEMENT ▪

SUBSCRIPTIONS To subscribe electronically, log on to cbtnews.com and click the subscribe link on the side bar. Alternately, forward your company name, your name, address, phone number and email address to info@cbtnews.com or CBT News, 5 Concourse Parkway, Atlanta, GA 30328.

Please send address changes to the above email or mailing address.

Permission to reprint or quote excerpts granted only upon written request.

Advertising rates are provided upon request.

Saban, Patrick Lencioni and many others.

Gain valuable MANAGEMENT skills to “Win in Business” with Marcus Lemonis and panel discussions from industry trailblazers.

Learn innovative and groundbreaking solutions to advance TECHNOLOGY and efficiency in your dealership with dedicated sessions from leading experts.

Accelerate your MARKETING efforts and stand out from the crowd with insider secrets from Jason Dorsey and proven digital techniques and tools from the best in the business.

C BTCO N F ER EN C EA N D EX P O.CO M

SALES

“Most business managers have a penetration or index number attached to their pay plan, or at least a bonus, so the penetration numbers are very important.”

Does the raw data tell you the real story?

WHAT WAS AVERAGE

FOR F&I IN 2015?

W

e had a great year in the car business in 2015. We blew past all the original predictions and it is suspected that in 2016 the trend will continue. What about Finance & Insurance (F&I)? How did the F&I departments do in 2015?

Unlike the amount of vehicles sold, it is difficult to find what the averages are in F&I. We often see reports from the public dealer groups and we hear about the top performers departments and we see the dealership on the left side of the book in our 20 Groups. But are those numbers representative of the average dealerships? If you want to know how your F&I department measures up against real raw data numbers, you are about to find out.

WANT TO FIND OUT HOW YOUR F&I DEPARTMENT IS DOING? HERE’S HOW.

I said, “real raw data numbers.” We have found over the years that the numbers sometimes published do not accurately represent what the true numbers are. Dealerships and dealer groups have shown profit in F&I department, which may not represent the job of the business manager.

As an examples, we have seen a documentary fee shown as profit to the F&I department. Granted

6

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

How to Increase Profitability Through Core Products

BY TONY DUPAQUIER

some dealers look at this as F&I profit; however I am sure, the business managers in those departments were not paid off of it.

When I joined Service Group as the director of The Academy, one of the very first tools I was introduced to was SG Analytix. The SG Analytix is a patented data mining tool designed to measure the effectiveness of every aspect of the F&I department and business managers. Beyond the basic info you would assume in any type of F&I reporting, we can measure which sales managers and sales people are more F&I friendly and where training opportunities lie within a dealership or a dealer group.

We also host quarterly, online F&I analysis and training of dealerships and dealer groups, where we are able to compare performance of individual Business Managers from the same or different dealerships. Best of all, dealers and business managers can view the data, online in real time with an Academy F&I Instructor, in an easy to read, scatter chart.

You could think of this as an hour- and-ahalf, 20 type group meeting of Business Managers.

“They [customers] are going because the credit union has competitive rates and more importantly, the credit union will tell the customer what the rate is, allowing the customer to determine a payment.”

Compared to the automotive industry as a whole, this sampling is small. The 68 dealerships represent a tick over 100 new car franchise dealerships, everything from European luxury, Asian imports to domestic dealerships and some standalone pre owned dealerships, large mega dealerships, multi franchise-multi rooftop dealer groups and single point family-run stores. The total deal count, 167,971 and production of 1191 involved business managers of various time and tenure.

WHAT IS THE BUSINESS MANAGER’S POINT OF VIEW? IT’S THE PAY PLAN.

I am looking at this from the business manager’s point of view. A business manager’s point of view is their pay plan. These numbers are the averages and where most business managers would be paid. It lies where we can find difference in many of the published numbers and the numbers you are seeing here.

Some published numbers will exclude noneligible vehicles (over 100,000 miles) or outside financed or cash deals or lease deals. I have seen published F&I averages *, however they told us it was only new financed vehicles. These numbers are everything that business managers are paid from; new, used, leased, cash purchase, outside finance purchase, in house financing, non-eligible units, everything. These are equal opportunity numbers. So if you are a dealer or GM, this may give you a measuring stick of the performance of you F&I team and as a business manager, you can compare yourself to the averages.

Overall Profit Per Unit (PRU) was $1,376.00.

Top performers almost doubled this, however this is not about the top performers. It is about the averages. Compared to numbers we have seen in the past, this may look lower, however this is only based on the production and effort of the business managers, nothing else added. Product Per Unit (PPU) 1.5. This number surprised me this year. I did expect it to be higher with all the additional scrutiny of the finance companies via the CFPB. I compared these numbers against 2013 & 2014 and there has been a shift in profitability towards products and away from finance reserve.

THE EMERGENCE OF CREDIT UNIONS IN FINANCING CARS AND WHAT YOU CAN DO ABOUT IT.

Looking at the industry core products, Service Contract penetration came in at 51%. Once again, this number include leases, so if we were to look at this on only purchase units, it would be higher.

Top performers are in the upper 60’s in VSC penetration. GAP was 52%. Even with insurance companies offering a similar product to the GAP available in the dealership, GAP continues to have over half acceptance. I must point out, that the GAP penetration is based only on in-house finance units.

IS CREDIT INSURANCE ON LIFE SUPPORT? WHAT PRODUCTS ARE IN AND WHAT ARE OUT?

Many in the industry consider Credit Life Insurance to be a “dead” product, which nobody wants. We are even seeing dealerships removing it completely from menus and simply having a sign stating that credit insurance is available. I have spoken with some dealer group executives who claim to have increased overall F&I production by removing this product all together. Regardless if you like it or not, 17% of all customers who financed a vehicle at the dealerships, saw enough value to purchase the product.

This number is a bit unfair to the popularity of the products. Not all dealerships offer these products.

If I could break down only the dealerships that offered Road Hazard, I am sure we would see penetration in excess of 40%.

With the additional scrutiny the CFPB has put on the Finance Companies and the “notifications” sent to dealerships concerning the rate mark ups, we are seeing a shift in the percentage of revenue.

VSC came in at 41% and finance reserve came in at 37%. It was not long ago that finance reserve accounted for 70+% of F&I revenue.

PRODUCTS AND PROFITABILITY.

Disability Insurance continues to reduce in acceptance. Last year, 4.5%. Similar to Credit Life, this is a product dealerships are removing off the menu and shifting to other products. And to be very candid, I do find the majority of dealerships that continue to offer the products have business managers who put little to no effort in presenting it to customers today.

We know that the CFPB has been investigating the amount of profit or mark up on F&I products, via the Finance Companies and this has spurred some dealerships and dealer groups, to create a Fair Pricing Policy for F&I products. Something similar to the Fair Credit Policy many dealerships have created, with regards to marking up the buy rate from the finance companies. If you are inclined to do so and would like a starting point, the averages may help. It is difficult to argue an unfair or abusive price, when it is based off,the averages. Below is a quick breakdown of the more popular products: • VSC .....................................$1101 • GAP .................................... $304 • Key ......................................$237 • PDR .....................................$253 • Paint Protection ............... $286 • Road Hazard ......................$238 • Windshield ........................$274

Over the past several years, we have seen a new grouping of products being offered in the business office, the ancillary products. From road hazard, to key replacement and many additional ways to keep your new vehicle looking good, these products are good profit areas for the dealerships with fantastic benefits to the customer. Overall, these products came in at a 14% acceptance level.

I complied the info, originally for myself, to answer questions from dealers or business managers. Granted, it gives you an idea of where you are, however it is only some true averages of the industry, without an *, based on the way someone want to report it, or where someone wants to see the money. Take it for what is worth, set your goal and always aim to be beyond, average.

TONY DUPAQUIER

Director of the Academy of Service Group Tony’s company sells financial and insurance products to dealerships and agents. He began his retail automotive career in 1990 as a salesperson and went on to hold positions including business manager, fleet sales manager, sales manager and general manager. He also conducts various F&I and advanced F&I workshops and has presented to more than 20 industry groups and state, national and international dealer associations.

Visit the website at www.sgifs.com.

Most business managers have a penetration or index number attached to their pay plan, or at least a bonus, so the penetration numbers are very important. Finance penetration was 78%. This number is decreasing. Although this number includes leases, this number continues to drop, year after year. Reason is that more and more customers are going to their credit union for their money. Why are they going to their credit union? They are going because the credit union has competitive rates and more importantly, the credit union will tell the customer what the rate is, allowing the customer to determine a payment.

The customer’s rate is the one unknown for customers walking into dealerships today. Have a Fair Credit Policy for your dealership and shift F&I profitability to products and away from finance reserve. I know that, however unpopular, dealerships and dealer groups who have done this have increased F&I profitability.

TO SEE MORE FROM TONY DUPAQUIER GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

7

SALES

“Most business managers have a penetration or index number attached to their pay plan, or at least a bonus, so the penetration numbers are very important.”

Does the raw data tell you the real story?

WHAT WAS AVERAGE

FOR F&I IN 2015?

W

e had a great year in the car business in 2015. We blew past all the original predictions and it is suspected that in 2016 the trend will continue. What about Finance & Insurance (F&I)? How did the F&I departments do in 2015?

Unlike the amount of vehicles sold, it is difficult to find what the averages are in F&I. We often see reports from the public dealer groups and we hear about the top performers departments and we see the dealership on the left side of the book in our 20 Groups. But are those numbers representative of the average dealerships? If you want to know how your F&I department measures up against real raw data numbers, you are about to find out.

WANT TO FIND OUT HOW YOUR F&I DEPARTMENT IS DOING? HERE’S HOW.

I said, “real raw data numbers.” We have found over the years that the numbers sometimes published do not accurately represent what the true numbers are. Dealerships and dealer groups have shown profit in F&I department, which may not represent the job of the business manager.

As an examples, we have seen a documentary fee shown as profit to the F&I department. Granted

6

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

How to Increase Profitability Through Core Products

BY TONY DUPAQUIER

some dealers look at this as F&I profit; however I am sure, the business managers in those departments were not paid off of it.

When I joined Service Group as the director of The Academy, one of the very first tools I was introduced to was SG Analytix. The SG Analytix is a patented data mining tool designed to measure the effectiveness of every aspect of the F&I department and business managers. Beyond the basic info you would assume in any type of F&I reporting, we can measure which sales managers and sales people are more F&I friendly and where training opportunities lie within a dealership or a dealer group.

We also host quarterly, online F&I analysis and training of dealerships and dealer groups, where we are able to compare performance of individual Business Managers from the same or different dealerships. Best of all, dealers and business managers can view the data, online in real time with an Academy F&I Instructor, in an easy to read, scatter chart.

You could think of this as an hour- and-ahalf, 20 type group meeting of Business Managers.

“They [customers] are going because the credit union has competitive rates and more importantly, the credit union will tell the customer what the rate is, allowing the customer to determine a payment.”

Compared to the automotive industry as a whole, this sampling is small. The 68 dealerships represent a tick over 100 new car franchise dealerships, everything from European luxury, Asian imports to domestic dealerships and some standalone pre owned dealerships, large mega dealerships, multi franchise-multi rooftop dealer groups and single point family-run stores. The total deal count, 167,971 and production of 1191 involved business managers of various time and tenure.

WHAT IS THE BUSINESS MANAGER’S POINT OF VIEW? IT’S THE PAY PLAN.

I am looking at this from the business manager’s point of view. A business manager’s point of view is their pay plan. These numbers are the averages and where most business managers would be paid. It lies where we can find difference in many of the published numbers and the numbers you are seeing here.

Some published numbers will exclude noneligible vehicles (over 100,000 miles) or outside financed or cash deals or lease deals. I have seen published F&I averages *, however they told us it was only new financed vehicles. These numbers are everything that business managers are paid from; new, used, leased, cash purchase, outside finance purchase, in house financing, non-eligible units, everything. These are equal opportunity numbers. So if you are a dealer or GM, this may give you a measuring stick of the performance of you F&I team and as a business manager, you can compare yourself to the averages.

Overall Profit Per Unit (PRU) was $1,376.00.

Top performers almost doubled this, however this is not about the top performers. It is about the averages. Compared to numbers we have seen in the past, this may look lower, however this is only based on the production and effort of the business managers, nothing else added. Product Per Unit (PPU) 1.5. This number surprised me this year. I did expect it to be higher with all the additional scrutiny of the finance companies via the CFPB. I compared these numbers against 2013 & 2014 and there has been a shift in profitability towards products and away from finance reserve.

THE EMERGENCE OF CREDIT UNIONS IN FINANCING CARS AND WHAT YOU CAN DO ABOUT IT.

Looking at the industry core products, Service Contract penetration came in at 51%. Once again, this number include leases, so if we were to look at this on only purchase units, it would be higher.

Top performers are in the upper 60’s in VSC penetration. GAP was 52%. Even with insurance companies offering a similar product to the GAP available in the dealership, GAP continues to have over half acceptance. I must point out, that the GAP penetration is based only on in-house finance units.

IS CREDIT INSURANCE ON LIFE SUPPORT? WHAT PRODUCTS ARE IN AND WHAT ARE OUT?

Many in the industry consider Credit Life Insurance to be a “dead” product, which nobody wants. We are even seeing dealerships removing it completely from menus and simply having a sign stating that credit insurance is available. I have spoken with some dealer group executives who claim to have increased overall F&I production by removing this product all together. Regardless if you like it or not, 17% of all customers who financed a vehicle at the dealerships, saw enough value to purchase the product.

This number is a bit unfair to the popularity of the products. Not all dealerships offer these products.

If I could break down only the dealerships that offered Road Hazard, I am sure we would see penetration in excess of 40%.

With the additional scrutiny the CFPB has put on the Finance Companies and the “notifications” sent to dealerships concerning the rate mark ups, we are seeing a shift in the percentage of revenue.

VSC came in at 41% and finance reserve came in at 37%. It was not long ago that finance reserve accounted for 70+% of F&I revenue.

PRODUCTS AND PROFITABILITY.

Disability Insurance continues to reduce in acceptance. Last year, 4.5%. Similar to Credit Life, this is a product dealerships are removing off the menu and shifting to other products. And to be very candid, I do find the majority of dealerships that continue to offer the products have business managers who put little to no effort in presenting it to customers today.

We know that the CFPB has been investigating the amount of profit or mark up on F&I products, via the Finance Companies and this has spurred some dealerships and dealer groups, to create a Fair Pricing Policy for F&I products. Something similar to the Fair Credit Policy many dealerships have created, with regards to marking up the buy rate from the finance companies. If you are inclined to do so and would like a starting point, the averages may help. It is difficult to argue an unfair or abusive price, when it is based off,the averages. Below is a quick breakdown of the more popular products: • VSC .....................................$1101 • GAP .................................... $304 • Key ......................................$237 • PDR .....................................$253 • Paint Protection ............... $286 • Road Hazard ......................$238 • Windshield ........................$274

Over the past several years, we have seen a new grouping of products being offered in the business office, the ancillary products. From road hazard, to key replacement and many additional ways to keep your new vehicle looking good, these products are good profit areas for the dealerships with fantastic benefits to the customer. Overall, these products came in at a 14% acceptance level.

I complied the info, originally for myself, to answer questions from dealers or business managers. Granted, it gives you an idea of where you are, however it is only some true averages of the industry, without an *, based on the way someone want to report it, or where someone wants to see the money. Take it for what is worth, set your goal and always aim to be beyond, average.

TONY DUPAQUIER

Director of the Academy of Service Group Tony’s company sells financial and insurance products to dealerships and agents. He began his retail automotive career in 1990 as a salesperson and went on to hold positions including business manager, fleet sales manager, sales manager and general manager. He also conducts various F&I and advanced F&I workshops and has presented to more than 20 industry groups and state, national and international dealer associations.

Visit the website at www.sgifs.com.

Most business managers have a penetration or index number attached to their pay plan, or at least a bonus, so the penetration numbers are very important. Finance penetration was 78%. This number is decreasing. Although this number includes leases, this number continues to drop, year after year. Reason is that more and more customers are going to their credit union for their money. Why are they going to their credit union? They are going because the credit union has competitive rates and more importantly, the credit union will tell the customer what the rate is, allowing the customer to determine a payment.

The customer’s rate is the one unknown for customers walking into dealerships today. Have a Fair Credit Policy for your dealership and shift F&I profitability to products and away from finance reserve. I know that, however unpopular, dealerships and dealer groups who have done this have increased F&I profitability.

TO SEE MORE FROM TONY DUPAQUIER GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

7

MARKETING Millennials have their priorities: They come first.

hand, because they are tech savvy, with every gadget imaginable almost becoming an extension of their bodies. They multi-task, talk, listen, type and text. And their priorities are simple: they come first.”

Millennials are not going to settle, as their parents may have done, and they put lifestyle, social communication, and friends above work.

They are not looking at work opportunities as “career” defined. As a matter of fact, the average tenure of Millennials is two years, and they do not consider it negative to have a resume that indicates multiple job experiences in a one year period. They are entrepreneurial and watch

Who Are The

MILLENNIALS, and Just What Is Going On? How to Reach Their Buying Power: Hint. Texting Helps

BY JUDY DEVERE

F

irst, let’s define the years that distinguishes this group: “A person reaching young adulthood around the year 2000, born inclusive of the years roughly between 1980 and 2004.”

In describing their characteristics, we find that there is a constantly changing description as late as 2009. Without question, this group is proving to be more unique and diverse than any previous generation. This is by far the fastest growing consumer group in the nation, and they are drastically changing our economy’s perspective on marketing, on products and employment.

Economic forecasts are suggesting that within 10 years they will be controlling the economic directions for our country, and they will represent 75% of the workplace by 2030.

We will look at them from the perspective of a buyer, how they view and participate in the auto industry as an employee, and what the industry will have to do to not only sell product to them, but also tap their skills and keep them as valuable employees.

LET’S START WITH WHO THEY ARE.

Here are only some frequent descriptions and statements that have been used by correspondents representing all phases of the American economy.

• “The largest, most diverse generation in the U.S. population.”

• “They value community, family, and creativity in their work.”

• “Millennial women have more labor market equality than previous generations.”

In this article, I will focus on different aspects of this group:

• “Millennials are less likely to be homeowners than young adults in previous generations.”

8

Who they are How are they impacting our economy now What are the projections for the future What is their effect on the automotive industry

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Here are some additional observations from Forbes. ✘ They aren’t influenced at all by advertising and do not respond to advertising. ✘ They want to engage with brands on social networks, and expect brands (including auto dealerships) to personally engage them. Sixty-two percent state that if a brand engages them on social networks, they are more likely to become a loyal customer. ✘ They are using multiple tech devices, with 87% using devices on a daily basis.

They immediately respond to new product technology. ✘ They are brand loyal. ✘ They expect brands to give back to society, and are “sick and tired” of corporate greed.

• “Millennials tend to get married later than previous generations.”

MILLENNIALS DON’T SETTLE AND PUT LIFESTYLE ABOVE WORK

Morley Safer from “60 Minutes” said it well: “The workplace has become a psychological battlefield and the Millennials have the upper

“Despite the fact that millennials currently only make up 12% of the U.S. new car sales, they will account for 40% of new car purchases by 2020.”

LET’S TRY TO SUM UP THIS ENORMOUS DATA BASE.

Remember: Millennials want job security, time off for personal needs, good benefits, opportunity for advancement, and a job that “helps society.”

They also list excessive work hours, inconsistent income, and social stigma as reasons they may not consider employment in the auto industry.

Since 43% of Millennials place “a job you enjoy” as most important, auto industry must somehow adjust to these demands, and find more effective

ways of not only welcoming the millennials into our workforce, but treating them seriously as major customers.

It is not just the auto industry that is going to be affected by the millennials. How our entire business economy responds will not only determine our potential successes or failures in these relationships, but may also jeopardize our very survival in this rapidly evolving economy. We can no longer “wait and see” how things will turn out. We may find we waited too long.

“As to auto brands, older millennials are likely

to include Mercedes, BMW, and Audi models, but younger millennials move more toward Japanese choices.”

Research Sources: The White House Economic Report, excerpts from Hireology, Forbes, Correspondent Morey Safer “60 Minutes” Broadcast, Detroit Bureau CNBC, “Driving Sales News,” Mosley Automotive “18-22 Year Old College Study,” University of Michigan Transportation Research Institute reports, Autotrader.com Industry Evaluations, Dealer.com, Dealer Advantage, Accenture.com, CDKGlobal.com

JODY DEVERE

Jeff Fromm from Forbes recently outlined some of their workplace characteristics:

CEO of AskPatty.com Inc.

➜ “They want to grow, even if that means growing out of your company.”

We can look at this as scary, or exciting and lifestyle-changing. If in fact these projections are true, then we had better make every effort we can to understand this group, or we may be left behind.

• • • •

for opportunities that will move them upwards, even if this means frequent moving from one job position to another.

and the likelihood of greater college debts, these factors influence a clearer grasp of economic realities. Mobility is the keyword. Ninety-five percent of millennials go online during the buying process, compared to 79% of overall respondents.

They wait longer than earlier generations to get their driver’s licenses. At younger ages they are image-conscious, but as they age are likely to become more practical in their automotive choices. As to auto brands, older millennials are likely to include Mercedes, BMW, and Audi models, but younger millennials move more toward Japanese choices.

Her company runs a website and blog, and offers training, education and marketing support on how dealerships and other automotive retailers can more effectively target women consumers. She speaks at conferences held by sponsors ranging from the National Independent Automobile Dealers Association and Mercedes-Benz to the Car Care Council Women’s Board. Visit her website at www.askpatty.com.

➜ “They want a coach, not a boss. They expect greater accessibility to the leadership in their offices, and are looking for more mentorship rather than just direction…69% percent consider their company’s review processes as flawed…Nearly 90% would feel more confident if they had on-going checkins with their bosses.” ➜ “They don’t want to waste time on the little things…” They consider their employer’s reimbursement policies as too difficult to contend with, so they by-pass conference and special event participation. ➜ “They want balance and democracy.”

Millennials will work hard but do not want to sit around the office until 5:00 p.m. if they have completed their work two hours earlier…Millennials no longer work for you; they work with you.”

OKAY. NOW LET’S TALK ABOUT THE MILLENNIAL INFLUENCE ON THE AUTOMOTIVE INDUSTRY

A recent AutoTrader.com study observes the following: Despite the fact that millennials currently only make up 12% of the U.S. new car sales, they will account for 40% of new car purchases by 2020. They are “big on small” vehicles, better designed for urban usage where many of them live. Since their generation faces higher levels of unemployment, lower entry pay,

They aren’t influenced by advertising and expect brands to give back to society.

TO SEE MORE FROM JODY DEVERE GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

9

MARKETING Millennials have their priorities: They come first.

hand, because they are tech savvy, with every gadget imaginable almost becoming an extension of their bodies. They multi-task, talk, listen, type and text. And their priorities are simple: they come first.”

Millennials are not going to settle, as their parents may have done, and they put lifestyle, social communication, and friends above work.

They are not looking at work opportunities as “career” defined. As a matter of fact, the average tenure of Millennials is two years, and they do not consider it negative to have a resume that indicates multiple job experiences in a one year period. They are entrepreneurial and watch

Who Are The

MILLENNIALS, and Just What Is Going On? How to Reach Their Buying Power: Hint. Texting Helps

BY JUDY DEVERE

F

irst, let’s define the years that distinguishes this group: “A person reaching young adulthood around the year 2000, born inclusive of the years roughly between 1980 and 2004.”

In describing their characteristics, we find that there is a constantly changing description as late as 2009. Without question, this group is proving to be more unique and diverse than any previous generation. This is by far the fastest growing consumer group in the nation, and they are drastically changing our economy’s perspective on marketing, on products and employment.

Economic forecasts are suggesting that within 10 years they will be controlling the economic directions for our country, and they will represent 75% of the workplace by 2030.

We will look at them from the perspective of a buyer, how they view and participate in the auto industry as an employee, and what the industry will have to do to not only sell product to them, but also tap their skills and keep them as valuable employees.

LET’S START WITH WHO THEY ARE.

Here are only some frequent descriptions and statements that have been used by correspondents representing all phases of the American economy.

• “The largest, most diverse generation in the U.S. population.”

• “They value community, family, and creativity in their work.”

• “Millennial women have more labor market equality than previous generations.”

In this article, I will focus on different aspects of this group:

• “Millennials are less likely to be homeowners than young adults in previous generations.”

8

Who they are How are they impacting our economy now What are the projections for the future What is their effect on the automotive industry

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Here are some additional observations from Forbes. ✘ They aren’t influenced at all by advertising and do not respond to advertising. ✘ They want to engage with brands on social networks, and expect brands (including auto dealerships) to personally engage them. Sixty-two percent state that if a brand engages them on social networks, they are more likely to become a loyal customer. ✘ They are using multiple tech devices, with 87% using devices on a daily basis.

They immediately respond to new product technology. ✘ They are brand loyal. ✘ They expect brands to give back to society, and are “sick and tired” of corporate greed.

• “Millennials tend to get married later than previous generations.”

MILLENNIALS DON’T SETTLE AND PUT LIFESTYLE ABOVE WORK

Morley Safer from “60 Minutes” said it well: “The workplace has become a psychological battlefield and the Millennials have the upper

“Despite the fact that millennials currently only make up 12% of the U.S. new car sales, they will account for 40% of new car purchases by 2020.”

LET’S TRY TO SUM UP THIS ENORMOUS DATA BASE.

Remember: Millennials want job security, time off for personal needs, good benefits, opportunity for advancement, and a job that “helps society.”

They also list excessive work hours, inconsistent income, and social stigma as reasons they may not consider employment in the auto industry.

Since 43% of Millennials place “a job you enjoy” as most important, auto industry must somehow adjust to these demands, and find more effective

ways of not only welcoming the millennials into our workforce, but treating them seriously as major customers.

It is not just the auto industry that is going to be affected by the millennials. How our entire business economy responds will not only determine our potential successes or failures in these relationships, but may also jeopardize our very survival in this rapidly evolving economy. We can no longer “wait and see” how things will turn out. We may find we waited too long.

“As to auto brands, older millennials are likely

to include Mercedes, BMW, and Audi models, but younger millennials move more toward Japanese choices.”

Research Sources: The White House Economic Report, excerpts from Hireology, Forbes, Correspondent Morey Safer “60 Minutes” Broadcast, Detroit Bureau CNBC, “Driving Sales News,” Mosley Automotive “18-22 Year Old College Study,” University of Michigan Transportation Research Institute reports, Autotrader.com Industry Evaluations, Dealer.com, Dealer Advantage, Accenture.com, CDKGlobal.com

JODY DEVERE

Jeff Fromm from Forbes recently outlined some of their workplace characteristics:

CEO of AskPatty.com Inc.

➜ “They want to grow, even if that means growing out of your company.”

We can look at this as scary, or exciting and lifestyle-changing. If in fact these projections are true, then we had better make every effort we can to understand this group, or we may be left behind.

• • • •

for opportunities that will move them upwards, even if this means frequent moving from one job position to another.

and the likelihood of greater college debts, these factors influence a clearer grasp of economic realities. Mobility is the keyword. Ninety-five percent of millennials go online during the buying process, compared to 79% of overall respondents.

They wait longer than earlier generations to get their driver’s licenses. At younger ages they are image-conscious, but as they age are likely to become more practical in their automotive choices. As to auto brands, older millennials are likely to include Mercedes, BMW, and Audi models, but younger millennials move more toward Japanese choices.

Her company runs a website and blog, and offers training, education and marketing support on how dealerships and other automotive retailers can more effectively target women consumers. She speaks at conferences held by sponsors ranging from the National Independent Automobile Dealers Association and Mercedes-Benz to the Car Care Council Women’s Board. Visit her website at www.askpatty.com.

➜ “They want a coach, not a boss. They expect greater accessibility to the leadership in their offices, and are looking for more mentorship rather than just direction…69% percent consider their company’s review processes as flawed…Nearly 90% would feel more confident if they had on-going checkins with their bosses.” ➜ “They don’t want to waste time on the little things…” They consider their employer’s reimbursement policies as too difficult to contend with, so they by-pass conference and special event participation. ➜ “They want balance and democracy.”

Millennials will work hard but do not want to sit around the office until 5:00 p.m. if they have completed their work two hours earlier…Millennials no longer work for you; they work with you.”

OKAY. NOW LET’S TALK ABOUT THE MILLENNIAL INFLUENCE ON THE AUTOMOTIVE INDUSTRY

A recent AutoTrader.com study observes the following: Despite the fact that millennials currently only make up 12% of the U.S. new car sales, they will account for 40% of new car purchases by 2020. They are “big on small” vehicles, better designed for urban usage where many of them live. Since their generation faces higher levels of unemployment, lower entry pay,

They aren’t influenced by advertising and expect brands to give back to society.

TO SEE MORE FROM JODY DEVERE GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

9

INDUSTRYnews IS THERE A DARK CLOUD ON THE SUNNY HORIZON OF RECORD CAR SALES?

BMW SHIFTS MONEY FROM FREE MAINTENANCE TO DEALER INCENTIVES

Based on AutoNation Inc.’s experience, the seemingly huge year for U.S. sales may be undercut by eroding profit margins thanks to expanding inventories of unsold vehicles, especially luxury cars.

BMW of North America will scale back its free scheduled maintenance offer to car owners starting with the 2017 model year, and use the savings to pay for a new bonus to dealers, according to media reports.

USA Today, Mike In an interview with Jackson, CEO of Fort Lauderdale, Fla.-based AutoNation, said his company’s 9 percent sales jump in December was essentially nullified by “significant retail discounts” on luxury models and propped up by more selling days than in December 2015.

Mike Jackson

Rather than soaring due to holiday gift purchases, U.S. sales of BMWs dropped nearly 17 percent after discounting, and Mercedes-Benz purchases edged up by less than 1 percent. Dealers had to fatten incentives to close deals on luxury cars, according to Jackson.

VW TAKES STEPS TO KEEP DEALERS HAPPY, AS ATTACKS CONTINUE Volkswagen says it has provided “customer satisfaction” bonuses and other incentives to U.S. dealers to help them financially survive the emissions scandal and its fallout on sales.

Michael Horn, CEO of Volkswagen’s U.S. business, told reporters at the North American International Auto Show in Detroit that his company is “committed to the dealers” and will help them survive a rough 2016. Volkswagen’s U.S. sales tumbled 11.3 percent in 4Q15 vs. the same period a year earlier.

In other developments on the Volkswagen scandal: • A German newspaper, Sueddeutsche Zeitung, reported the company expects to need to buy back about 115,000 vehicles in the U.S. through refunds or significant discounts on new cars. That would mean as many as 385,000 diesel vehicles would need major refits to meet U.S. exhaust standards.

Effective in the coming April, BMW will offer dealers who meet certain standards and hire Genius product specialists a bonus equal to 1 percent of the sticker price of new vehicles sold. BMW also plans to simplify its dealer incentive targets and further streamline them in 2017, when it will start emphasizing dealership loyalty rates over CSI scores.

BMW now offers free maintenance for four years or 50,000 miles. Those levels are being scaled back to three years or 36,000 miles.

LAWSUIT ACCUSES FIAT CHRYSLER OF ASKING DEALERS TO PAD SALES

Two dealerships in a suburban Chicago group filed a federal racketeering lawsuit against their nameplate manufacturer FCA U.S. LLC, alleging Fiat Chrysler dealers were offered payments to falsely report vehicles as sold.

The claim filed in U.S. District Court in Chicago claimed FCA paid dealers to report vehicles that were unsold at month’s end as sold, and the next business day the “transaction” could be unwound before the factory warranty began to run. The dealerships are part of the Lansing, Ill.-based Napleton Automotive Group.

In a prepared statement, FCA said the lawsuit lacks merit and said the two “disgruntled dealers” did not provide evidence supporting their claims.

The automaker said it carried out its own investigation before the lawsuit ever was filed and that the plaintiffs had failed to meet their responsibilities under FCA’s dealership agreement.

• The U.S. Justice Department sued Volkswagen for up to $48 million of damages stemming from alleged violations of federal environmental laws.

PART OF FEDERAL ACTION AGAINST TRUECAR IS ALLOWED TO CONTINUE

• The California Air Resources Board rejected the company’s plan to fix 2.0-liter diesels with software that the state board says would still let cars emit up to 40 times the legally allowed pollution.

A federal judge in January refused to prevent a coalition of 162 new and used car dealerships from proceeding with their claim that TrueCar Inc. broke federal and New York State laws by promoting a haggle-free experience and by telling customers they could learn factory invoice prices and use them to get “an exceptional offer.”

PENSKE ENTERS A JOINT VENTURE TO SELL CARS IN JAPAN

Bloomfield Hills, Mich.-based Penske Automotive Group is breaking into the Asian market through a Japanese joint venture, in which it is acquiring 49 percent of the equity in The Nicole Group.

Nicole operates luxury dealerships in Tokyo and Kanagawa, with four BMW and three Mini stores to go with one Rolls Royce and one Ferrari rooftop. It also is Japan’s exclusive importer and distributor of BMW Alpina vehicles.

FIELDS AUTO GROUP BUYS OUT 7-STORE SOUTHEAST CHAIN

The Fields Auto Group of Glencoe, Ill., has struck a deal to buy the seven Brumos Automotive stores in northeast Florida and southeast Georgia. Brumos represents the Mercedes-Benz, Lexus, Porsche, Smart and Sprinter nameplates.

The deal is expected to close in mid-February. Jacksonville, Fla.-based Brumos is not releasing financial terms due the need for government and manufacturer approvals.

Forty-five-year-old Fields had 38 franchises at 25 dealership sites in Florida, Illinois, Wisconsin and North Carolina, before the Brumos buyout was negotiated.

10

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

However, the U.S. District Court judge in New York City did throw out other portions of the lawsuit alleging Santa Monica, Calif.-based TrueCar also made deceptive advertising statements about financing, transparency, pricing and rebates.

LARRY H. MILLER USHERS IN A NEW BOARD Sandy, Utah-based Larry H. Miller Group of Companies named a new, 12-member board. Earlier in 2015, the parent corporation, which owns 54 dealerships among other properties, had announced a new corporate structure and a nationwide search for board members with experience outside of the Miller organization.

New outside directors include Brigham Young University professor Steve Albrecht; Dennis Haslam, former president of the Utah Jazz basketball franchise; Michael Montelongo, chief administrative officer of Sodexho Inc.; Beryl Raff, chairman and CEO of Helzberg Diamonds; Robert Restrepo Jr., chairman of the State Auto Insurance Companies; Mary Lee Schneider, ex-president and CEO of Follett Corp.; and Lloyd “Buzz” Waterhouse, senior advisor at New Mountain Capital.

INDUSTRYnews IS THERE A DARK CLOUD ON THE SUNNY HORIZON OF RECORD CAR SALES?

BMW SHIFTS MONEY FROM FREE MAINTENANCE TO DEALER INCENTIVES

Based on AutoNation Inc.’s experience, the seemingly huge year for U.S. sales may be undercut by eroding profit margins thanks to expanding inventories of unsold vehicles, especially luxury cars.

BMW of North America will scale back its free scheduled maintenance offer to car owners starting with the 2017 model year, and use the savings to pay for a new bonus to dealers, according to media reports.

USA Today, Mike In an interview with Jackson, CEO of Fort Lauderdale, Fla.-based AutoNation, said his company’s 9 percent sales jump in December was essentially nullified by “significant retail discounts” on luxury models and propped up by more selling days than in December 2015.

Mike Jackson

Rather than soaring due to holiday gift purchases, U.S. sales of BMWs dropped nearly 17 percent after discounting, and Mercedes-Benz purchases edged up by less than 1 percent. Dealers had to fatten incentives to close deals on luxury cars, according to Jackson.

VW TAKES STEPS TO KEEP DEALERS HAPPY, AS ATTACKS CONTINUE Volkswagen says it has provided “customer satisfaction” bonuses and other incentives to U.S. dealers to help them financially survive the emissions scandal and its fallout on sales.

Michael Horn, CEO of Volkswagen’s U.S. business, told reporters at the North American International Auto Show in Detroit that his company is “committed to the dealers” and will help them survive a rough 2016. Volkswagen’s U.S. sales tumbled 11.3 percent in 4Q15 vs. the same period a year earlier.

In other developments on the Volkswagen scandal: • A German newspaper, Sueddeutsche Zeitung, reported the company expects to need to buy back about 115,000 vehicles in the U.S. through refunds or significant discounts on new cars. That would mean as many as 385,000 diesel vehicles would need major refits to meet U.S. exhaust standards.

Effective in the coming April, BMW will offer dealers who meet certain standards and hire Genius product specialists a bonus equal to 1 percent of the sticker price of new vehicles sold. BMW also plans to simplify its dealer incentive targets and further streamline them in 2017, when it will start emphasizing dealership loyalty rates over CSI scores.

BMW now offers free maintenance for four years or 50,000 miles. Those levels are being scaled back to three years or 36,000 miles.

LAWSUIT ACCUSES FIAT CHRYSLER OF ASKING DEALERS TO PAD SALES

Two dealerships in a suburban Chicago group filed a federal racketeering lawsuit against their nameplate manufacturer FCA U.S. LLC, alleging Fiat Chrysler dealers were offered payments to falsely report vehicles as sold.

The claim filed in U.S. District Court in Chicago claimed FCA paid dealers to report vehicles that were unsold at month’s end as sold, and the next business day the “transaction” could be unwound before the factory warranty began to run. The dealerships are part of the Lansing, Ill.-based Napleton Automotive Group.

In a prepared statement, FCA said the lawsuit lacks merit and said the two “disgruntled dealers” did not provide evidence supporting their claims.

The automaker said it carried out its own investigation before the lawsuit ever was filed and that the plaintiffs had failed to meet their responsibilities under FCA’s dealership agreement.

• The U.S. Justice Department sued Volkswagen for up to $48 million of damages stemming from alleged violations of federal environmental laws.

PART OF FEDERAL ACTION AGAINST TRUECAR IS ALLOWED TO CONTINUE

• The California Air Resources Board rejected the company’s plan to fix 2.0-liter diesels with software that the state board says would still let cars emit up to 40 times the legally allowed pollution.

A federal judge in January refused to prevent a coalition of 162 new and used car dealerships from proceeding with their claim that TrueCar Inc. broke federal and New York State laws by promoting a haggle-free experience and by telling customers they could learn factory invoice prices and use them to get “an exceptional offer.”

PENSKE ENTERS A JOINT VENTURE TO SELL CARS IN JAPAN

Bloomfield Hills, Mich.-based Penske Automotive Group is breaking into the Asian market through a Japanese joint venture, in which it is acquiring 49 percent of the equity in The Nicole Group.

Nicole operates luxury dealerships in Tokyo and Kanagawa, with four BMW and three Mini stores to go with one Rolls Royce and one Ferrari rooftop. It also is Japan’s exclusive importer and distributor of BMW Alpina vehicles.

FIELDS AUTO GROUP BUYS OUT 7-STORE SOUTHEAST CHAIN

The Fields Auto Group of Glencoe, Ill., has struck a deal to buy the seven Brumos Automotive stores in northeast Florida and southeast Georgia. Brumos represents the Mercedes-Benz, Lexus, Porsche, Smart and Sprinter nameplates.

The deal is expected to close in mid-February. Jacksonville, Fla.-based Brumos is not releasing financial terms due the need for government and manufacturer approvals.

Forty-five-year-old Fields had 38 franchises at 25 dealership sites in Florida, Illinois, Wisconsin and North Carolina, before the Brumos buyout was negotiated.

10

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

However, the U.S. District Court judge in New York City did throw out other portions of the lawsuit alleging Santa Monica, Calif.-based TrueCar also made deceptive advertising statements about financing, transparency, pricing and rebates.

LARRY H. MILLER USHERS IN A NEW BOARD Sandy, Utah-based Larry H. Miller Group of Companies named a new, 12-member board. Earlier in 2015, the parent corporation, which owns 54 dealerships among other properties, had announced a new corporate structure and a nationwide search for board members with experience outside of the Miller organization.

New outside directors include Brigham Young University professor Steve Albrecht; Dennis Haslam, former president of the Utah Jazz basketball franchise; Michael Montelongo, chief administrative officer of Sodexho Inc.; Beryl Raff, chairman and CEO of Helzberg Diamonds; Robert Restrepo Jr., chairman of the State Auto Insurance Companies; Mary Lee Schneider, ex-president and CEO of Follett Corp.; and Lloyd “Buzz” Waterhouse, senior advisor at New Mountain Capital.

MARKETING

How To Identify

Real Potential Car Sales In Your Service Lane Pre-set your screening criteria and then develop

a pre-screening process based on smart questions.

BY JOHN GIAMALVO By using the right technology and service provider, you can quickly assess a service customer’s creditworthiness against pre-determined criteria.

“There are many ways to tap into this

potential stream of revenue, and

your dealership can do so without having to loop in your sales team every time one of your advisors has a hunch.”

You want to present a case to service customers that sparks the right sort of conversation.

Y

our service lane can be a great source of sales in your dealership, but the difficult part is picking out which consumers coming in for repairs could be quality leads. After all, you don’t want your service advisors striking up a conversation about trade-ins with just anyone.

When a customer comes in for a service visit, he or she may be willing to consider trading up or trading down, especially if an unexpected expense (or more likely, one that isn’t covered by their insurance) is required to fix the current vehicle.

There are many ways to tap into this potential stream of revenue, and your dealership can do so without having to loop in your sales team every time one of your advisors has a hunch about a customer who may be open to discussing options.

The trick is to establish and reinforce sound marketing practices to identify qualified buyers, and then present a case to those prospects that sparks a conversation, a test drive and a trip to the F&I department to work out a contract.

12

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

START BY IDENTIFYING THE RIGHT CUSTOMER

The key to striking up a conversation with the right customers is gaining access to accurate information that will help you determine their creditworthiness. Various dealer service providers and credit bureaus can help you establish tailored criteria for pre-screening customers to help determine their credit worthiness, as part of your service work flow.

As a case in point, Equifax is teaming up with various service providers to offer a suite of creditbased marketing products (one of which is called PowerLead Offer) that can facilitate a process for dealers to initiate individual consumer pre-screens instantly and engage qualifying consumers with firm offers of credit on the spot, whether they’re in the showroom or the service lane.

HOW THE SERVICE LANE INTERACTION LOOKS

Here’s a walk-through of what such a process could look like in your service lane:

To start with, you would have to establish a set of pre-determined criteria based on credit score and other financial attributes that align with your credit standards. Your service provider would need to save these defined attributes, so your dealership could be notified when one of your customers meets the criteria. Once that baseline has been established, you’re ready to start prescreening your customers in the service lane.

It’s important to note that you cannot simply pre-screen every customer who walks through your door; you must have that customer’s consent to use his or her information. Whether the appropriate language is included in a disclosure or privacy notice, you should consult your service provider or a legal representative to ensure your business practices comply with all state or federal laws.

PULLING INFO FOR QUALIFYING ANALYSIS

As customers wait for their vehicles, your team can scan their driver’s licenses or manually input their information into a software set-up that pulls relevant details and sends them to your service provider for review. If the system locates the customer’s file, it then is analyzed against your dealership’s pre-defined criteria.

Reports that qualify would be sent to your service provider to be shared with the appropriate manager and his or her team. From there, you can print out a firm offer of credit and hand-deliver

it to your customer, all while that customer is still sitting your waiting room during the vehicle inspection.

In addition to a notification as to whether a customer qualifies, your dealership also may be able to receive select details about that customer’s financial standing. For example, a report could include the customer’s credit score along with a notification of what the remaining balance is on the current auto loan. Coupling that information with a quick appraisal of the vehicle’s value, your team can construct a real-time look at the customer’s equity position. This additional information may help ensure that consumers continue to meet other conditions needed to receive the firm offer of credit.

HOW SHOULD WE APPROACH THAT CUSTOMER?

With a clear picture of the customer’s financial situation, your team now can make an informed decision about how to approach the customer.

After making a firm offer of credit, which vehicles in your lot should you show them? The decision is up to your team, but you’ll be prepared to guide your customers toward the option best-suited to them based on their credit standing.

Your team clearly can benefit from utilizing a credit-based pre-screening tool, but more importantly your customers would not be affected if they don’t qualify based on your pre-defined criteria. In such cases, no inquiry would be posted on your customer’s credit file, and your dealership can move forward with inspecting and repairing the vehicle. It’s business as usual.

TO SEE MORE FROM JOHN GIAMALVO GO TO CBTNEWS.COM

CUSTOMERS EXPERIENCE BENEFITS, TOO

In short, these processes not only assist your service advisors in gaining a better understanding of the customers in their service lane, but also they allow your dealership to offer an exceptional overall experience to these customers by providing firm offers of credit and educating them on their financing options.

The benefits of these credit-based marketing suites aren’t limited to your service lane, either.

For example, they can be adapted to run on your dealership’s website to attract more qualified leads. Imagine having a tool on your website that allows consumers to receive a complimentary credit check. They might profit from the benefits of knowing their credit score before walking onto your showroom floor, while your dealership receives a clearer picture of their financial standing to direct them toward a model and rate that they can realistically afford.

Today’s consumers – not to mention the shoppers of tomorrow – are all about instant gratification and ease of access to information.

Your dealership’s sales team already is going to significant lengths to meet these expectations, so

“You cannot simply pre-screen every customer who walks through your door; you must have that

customer’s consent to use his or her information.”

why not match their efforts and get a leg up on the competition?

Give your partner lenders and your dealer service provider a call to discuss implementing a credit-based marketing solution in your work flow. It’s an efficient and easy way to bring in more qualified leads, and you’ll have the opportunity to generate an even greater revenue stream from the service lane for your dealership.

JOHN GIAMALVO

VP of Dealer Services at Equifax In his position, John oversees collaboration among national dealership groups and enterprise alliances regarding efficient consumer transactions. Before coming to Equifax, he was director of dealer initiatives at Edmunds.com and held leadership positions at the BarNone division of CoreLogic and at Star Auto Group.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

13

MARKETING

How To Identify

Real Potential Car Sales In Your Service Lane Pre-set your screening criteria and then develop

a pre-screening process based on smart questions.

BY JOHN GIAMALVO By using the right technology and service provider, you can quickly assess a service customer’s creditworthiness against pre-determined criteria.

“There are many ways to tap into this

potential stream of revenue, and

your dealership can do so without having to loop in your sales team every time one of your advisors has a hunch.”

You want to present a case to service customers that sparks the right sort of conversation.

Y

our service lane can be a great source of sales in your dealership, but the difficult part is picking out which consumers coming in for repairs could be quality leads. After all, you don’t want your service advisors striking up a conversation about trade-ins with just anyone.

When a customer comes in for a service visit, he or she may be willing to consider trading up or trading down, especially if an unexpected expense (or more likely, one that isn’t covered by their insurance) is required to fix the current vehicle.

There are many ways to tap into this potential stream of revenue, and your dealership can do so without having to loop in your sales team every time one of your advisors has a hunch about a customer who may be open to discussing options.

The trick is to establish and reinforce sound marketing practices to identify qualified buyers, and then present a case to those prospects that sparks a conversation, a test drive and a trip to the F&I department to work out a contract.

12

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CAR BIZ TODAY FEBRUARY 2016

START BY IDENTIFYING THE RIGHT CUSTOMER

The key to striking up a conversation with the right customers is gaining access to accurate information that will help you determine their creditworthiness. Various dealer service providers and credit bureaus can help you establish tailored criteria for pre-screening customers to help determine their credit worthiness, as part of your service work flow.

As a case in point, Equifax is teaming up with various service providers to offer a suite of creditbased marketing products (one of which is called PowerLead Offer) that can facilitate a process for dealers to initiate individual consumer pre-screens instantly and engage qualifying consumers with firm offers of credit on the spot, whether they’re in the showroom or the service lane.

HOW THE SERVICE LANE INTERACTION LOOKS

Here’s a walk-through of what such a process could look like in your service lane:

To start with, you would have to establish a set of pre-determined criteria based on credit score and other financial attributes that align with your credit standards. Your service provider would need to save these defined attributes, so your dealership could be notified when one of your customers meets the criteria. Once that baseline has been established, you’re ready to start prescreening your customers in the service lane.

It’s important to note that you cannot simply pre-screen every customer who walks through your door; you must have that customer’s consent to use his or her information. Whether the appropriate language is included in a disclosure or privacy notice, you should consult your service provider or a legal representative to ensure your business practices comply with all state or federal laws.

PULLING INFO FOR QUALIFYING ANALYSIS

As customers wait for their vehicles, your team can scan their driver’s licenses or manually input their information into a software set-up that pulls relevant details and sends them to your service provider for review. If the system locates the customer’s file, it then is analyzed against your dealership’s pre-defined criteria.

Reports that qualify would be sent to your service provider to be shared with the appropriate manager and his or her team. From there, you can print out a firm offer of credit and hand-deliver

it to your customer, all while that customer is still sitting your waiting room during the vehicle inspection.

In addition to a notification as to whether a customer qualifies, your dealership also may be able to receive select details about that customer’s financial standing. For example, a report could include the customer’s credit score along with a notification of what the remaining balance is on the current auto loan. Coupling that information with a quick appraisal of the vehicle’s value, your team can construct a real-time look at the customer’s equity position. This additional information may help ensure that consumers continue to meet other conditions needed to receive the firm offer of credit.

HOW SHOULD WE APPROACH THAT CUSTOMER?

With a clear picture of the customer’s financial situation, your team now can make an informed decision about how to approach the customer.

After making a firm offer of credit, which vehicles in your lot should you show them? The decision is up to your team, but you’ll be prepared to guide your customers toward the option best-suited to them based on their credit standing.

Your team clearly can benefit from utilizing a credit-based pre-screening tool, but more importantly your customers would not be affected if they don’t qualify based on your pre-defined criteria. In such cases, no inquiry would be posted on your customer’s credit file, and your dealership can move forward with inspecting and repairing the vehicle. It’s business as usual.

TO SEE MORE FROM JOHN GIAMALVO GO TO CBTNEWS.COM

CUSTOMERS EXPERIENCE BENEFITS, TOO

In short, these processes not only assist your service advisors in gaining a better understanding of the customers in their service lane, but also they allow your dealership to offer an exceptional overall experience to these customers by providing firm offers of credit and educating them on their financing options.

The benefits of these credit-based marketing suites aren’t limited to your service lane, either.

For example, they can be adapted to run on your dealership’s website to attract more qualified leads. Imagine having a tool on your website that allows consumers to receive a complimentary credit check. They might profit from the benefits of knowing their credit score before walking onto your showroom floor, while your dealership receives a clearer picture of their financial standing to direct them toward a model and rate that they can realistically afford.

Today’s consumers – not to mention the shoppers of tomorrow – are all about instant gratification and ease of access to information.

Your dealership’s sales team already is going to significant lengths to meet these expectations, so

“You cannot simply pre-screen every customer who walks through your door; you must have that

customer’s consent to use his or her information.”

why not match their efforts and get a leg up on the competition?

Give your partner lenders and your dealer service provider a call to discuss implementing a credit-based marketing solution in your work flow. It’s an efficient and easy way to bring in more qualified leads, and you’ll have the opportunity to generate an even greater revenue stream from the service lane for your dealership.

JOHN GIAMALVO

VP of Dealer Services at Equifax In his position, John oversees collaboration among national dealership groups and enterprise alliances regarding efficient consumer transactions. Before coming to Equifax, he was director of dealer initiatives at Edmunds.com and held leadership positions at the BarNone division of CoreLogic and at Star Auto Group.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

13

MANAGEMENT LEADERSHIP ALIGNMENT

“Success requires that all employee performance, management alignment and immersion learning initiatives need to be integrated and aligned with dealership and organizational objectives.”

of Management and Employee Alignment Cultures Profitabilty is at Stake If Goals and Culture Clash

BY MICHAEL ROPPO

W

ith time being the most valuable inventory within a dealership environment and productivity experts always challenging us to run faster — with a lot less — generating intentional profitability at times requires that you slow down to speed up. Why? Because sometimes when you get running really fast, and have no real management alignment process in place, it’s easy to create problems.

These problems can contribute to losing people, productivity and profitability opportunities even with all the quick shop huddles and standing meetings that usually take place just for meeting sake.

ACHIEVING A GENUINE MANAGEMENT ALIGNMENT CULTURE IS HARD BUT VERY DOABLE.

A genuine management alignment culture involves a top-to-bottom transformation in which dealers leaders and managers communicate all critical performance indicators, financial and operational goals and expectations for every profit center of the dealership and influencing problem management controls. This must be done until everyone has an understanding of what is expected of them and what they must do to advance the dealership’s overall performance and organization by pulling everyone and everything in the right direction.

Interestingly enough, dealership organizations usually get to see and experience some form of management alignment during times of crisis.

There is a saying in the industry that goes something like this: Good things happen in bad times and bad things happen when everything gets a little too predictable and comfortable!

Sound familiar?

In the face of constant change and significant challenge, many dealers, leaders, managers and even employees join together in panic mode and work together to help overcome the difficulties

that potentially could cost a tremendous amount of profitability! With that being said, I can also tell you that dealership organizations don’t and shouldn’t have to wait for a crisis to achieve this thing we refer to as management alignment. By taking the right proactive steps to set strategic, planning, attention to critical performance indicators and explaining priorities throughout the many dealerships profit centers, everyone in the process could gain a sense of ownership and accountability. The result is an energized entity with a clear and consistent vision made up of values that define the process.

THE GOALS OF MANAGEMENT ALIGNMENT

Some of the goals of management alignment might include: ✔ Limit many of dealership departmental problems from happening and reoccurring while influencing a best practice process. ✔ Help defeat much of the Management Malpractice and all the hidden activity based costs and problems that are usually associated to the business, minimize both the number and severity of incidents and potential problems to the business/organization. ✔ Help reduce the adverse impact of incidents and problems that are caused by errors within the several dealerships profit center operations, and prevent recurrence of incidents related to these errors, which limit sales service and parts from doing business in a profitable manner. ✔ Management alignment should be addressed in priority order with higher priority given to the resolution of problems that can cause serious disruption to daily weekly and monthly operational and financial critical performance indicators.

The Management Alignment puzzle is hard to achieve but well worth it.

ACCOUNTABILITY Management is responsible and accountable for ensuring that incident and best practice process information is documented in such a way that it is readily available to support all management alignment initiatives and activities by understanding that Management Alignment has reactive and proactive aspects:

REACTIVE ACTIVITIES INCLUDE:

• Problem solving when one or more incidents of the same nature occurs in every profit center and effects the overall dealership performance .

• Identification of known errors through incident management implementing a solution only at the time of the occurrence just to get it over with

PROACTIVE ACTIVITIES INCLUDE:

• Identifying and solving problems and known errors before incidents occur in the first place

“Management Alignment is that missing but desired state in which the entire dealership and organization is working together to achieve all

their metrics, critical performance indicators and business goals ‘intentionally!’”

14

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

• Finding a solution to a recurring problem • Creating a solution • Including the solution in the known errors’ database

STEPS TO INFLUENCING A MANAGEMENT ALIGNMENT & EMPLOYEE CULTURE:

Before dealerships can realize the benefits of having any form of an aligned workforce, there are several changes that must take place. As with any major organizational improvement, a c h i e v i n g management and employee alignment doesn’t happen on its own and certainly not overnight. It requires time and a full commitment from dealers, leaders, managers as well as employees! With all the changes needed to take place, the ultimate outcome will be different for each and every dealership and organization, the following tips can help dealerships seeking organizational Management and Employee Alignment:

organization.

• A good leader who takes the time to get to know the company inside and out has a higher probability of generating a plan that resonates with and for everyone.

COMMIT TO A REGIMENTED PERFORMANCE MANAGEMENT ALIGNMENT MONITORING PROCESS:

• Well-executed performance management alignment should include regular monitoring of critical performance indicators as well as discussion of daily achievements.

• Gaps against the goals shouldn’t be significant, and if they are, the goals should be reset.

• Progression against goal attainment will further engage and motivate employees, especially top performers • Consider rewarding them when they attain their performance targets.

FORMAL IMMERSION LEARNING INTEGRATION:

Success requires that all employee performance, management alignment and immersion learning initiatives need to be integrated and aligned with dealership and organizational objectives. If the two are separate, learning remains reactive and performance management is relegated to longer term performance appraisal which weakens performance and profitability. When these

variables are joined together, organizational growth, transformation, productivity and profitability results can be expected.

IT’S A CHALLENGING INITIATIVE:

Some of the biggest challenges for many of the dealership organizations that I visit lies in achieving total departmental and organizational alignment. Management Alignment is that missing but desired state in which the entire dealership and organization is working together to achieve all their metrics, critical performance indicators and business goals “intentionally!”

Just like the engine in a vehicle if the parts aren’t aligned with the other components and moving in the same direction at the same velocity, there will be no forward movement intentional performance cannot happen! Just one part can cause all this you ask? Absolutely! Unlike a vehicle, creating a management alignment culture in a dealership organization cannot and will not be achieved just by tinkering around with a few key components ad meeting for meeting sake.

THE BOTTOM LINE RESULT:

Management and employee alignment is all about attracting, developing, and retaining an employee workforce needed to meet and exceed current customer expectations and demands. If leadership is unable to create a clear blueprint that can be communicated and embraced throughout the dealership and organization, it will be much more difficult to establish a high-performing workforce able to meet those goals and Influence success.

ESTABLISH AND SET REALISTIC ATTAINABLE GOALS:

• For management alignment to be achieved, well-defined, and attainable goals should be established in such a way that they don’t have to be modified and revisited each month.

• Once meaningful, employee-specific goals have been put in place, those goals become a blueprint for the year, lending a strong sense of direction across the organization and to ensure progress advancement as well as determining if and when corrective action is required.

Success will come when all management and employee performance and learning initiatives are aligned.

INFLUENCE TRAINING THAT LINKS TO PERFORMANCE:

• Facts state that when dealership organizations link performance to learning, employees are able to expand their skill sets and reach personal and professional goals.

• This helps employees to better, understand the business priorities and how their skills are needed to achieve them.

INFLUENCE A STRONG LEADERSHIP CULTURE:

• Real management alignment requires strong leadership culture, capable of establishing a plan and selling it to the entire dealership and

TO SEE MORE FROM MICHAEL ROPPO GO TO CBTNEWS.COM

MICHAEL ROPPO

Director of Fixed Operations and Training /QPS Automotive Domain Results Michael has more than 30 years of experience providing consulting services to the auto dealer industry through Automotive Domain Results, a highly specialized practice with a mission is to help dealerships of all sizes achieve maximum profitability, customer satisfaction and retention. Through the implementation of Automotive Domain’s propriety tools, training and resources, he has helped countless dealers improve the quality of their management teams and the personnel who come in contact with their customers. Michael also brings the deep resources made available through Automotive Domain’s parent company, WithumSmith+Brown, CPAs, becoming a full service advisor to any auto dealer. Visit his website at AutomotiveDomainResults.com.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

15

MANAGEMENT LEADERSHIP ALIGNMENT

“Success requires that all employee performance, management alignment and immersion learning initiatives need to be integrated and aligned with dealership and organizational objectives.”

of Management and Employee Alignment Cultures Profitabilty is at Stake If Goals and Culture Clash

BY MICHAEL ROPPO

W

ith time being the most valuable inventory within a dealership environment and productivity experts always challenging us to run faster — with a lot less — generating intentional profitability at times requires that you slow down to speed up. Why? Because sometimes when you get running really fast, and have no real management alignment process in place, it’s easy to create problems.

These problems can contribute to losing people, productivity and profitability opportunities even with all the quick shop huddles and standing meetings that usually take place just for meeting sake.

ACHIEVING A GENUINE MANAGEMENT ALIGNMENT CULTURE IS HARD BUT VERY DOABLE.

A genuine management alignment culture involves a top-to-bottom transformation in which dealers leaders and managers communicate all critical performance indicators, financial and operational goals and expectations for every profit center of the dealership and influencing problem management controls. This must be done until everyone has an understanding of what is expected of them and what they must do to advance the dealership’s overall performance and organization by pulling everyone and everything in the right direction.

Interestingly enough, dealership organizations usually get to see and experience some form of management alignment during times of crisis.

There is a saying in the industry that goes something like this: Good things happen in bad times and bad things happen when everything gets a little too predictable and comfortable!

Sound familiar?

In the face of constant change and significant challenge, many dealers, leaders, managers and even employees join together in panic mode and work together to help overcome the difficulties

that potentially could cost a tremendous amount of profitability! With that being said, I can also tell you that dealership organizations don’t and shouldn’t have to wait for a crisis to achieve this thing we refer to as management alignment. By taking the right proactive steps to set strategic, planning, attention to critical performance indicators and explaining priorities throughout the many dealerships profit centers, everyone in the process could gain a sense of ownership and accountability. The result is an energized entity with a clear and consistent vision made up of values that define the process.

THE GOALS OF MANAGEMENT ALIGNMENT

Some of the goals of management alignment might include: ✔ Limit many of dealership departmental problems from happening and reoccurring while influencing a best practice process. ✔ Help defeat much of the Management Malpractice and all the hidden activity based costs and problems that are usually associated to the business, minimize both the number and severity of incidents and potential problems to the business/organization. ✔ Help reduce the adverse impact of incidents and problems that are caused by errors within the several dealerships profit center operations, and prevent recurrence of incidents related to these errors, which limit sales service and parts from doing business in a profitable manner. ✔ Management alignment should be addressed in priority order with higher priority given to the resolution of problems that can cause serious disruption to daily weekly and monthly operational and financial critical performance indicators.

The Management Alignment puzzle is hard to achieve but well worth it.

ACCOUNTABILITY Management is responsible and accountable for ensuring that incident and best practice process information is documented in such a way that it is readily available to support all management alignment initiatives and activities by understanding that Management Alignment has reactive and proactive aspects:

REACTIVE ACTIVITIES INCLUDE:

• Problem solving when one or more incidents of the same nature occurs in every profit center and effects the overall dealership performance .

• Identification of known errors through incident management implementing a solution only at the time of the occurrence just to get it over with

PROACTIVE ACTIVITIES INCLUDE:

• Identifying and solving problems and known errors before incidents occur in the first place

“Management Alignment is that missing but desired state in which the entire dealership and organization is working together to achieve all

their metrics, critical performance indicators and business goals ‘intentionally!’”

14

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

• Finding a solution to a recurring problem • Creating a solution • Including the solution in the known errors’ database

STEPS TO INFLUENCING A MANAGEMENT ALIGNMENT & EMPLOYEE CULTURE:

Before dealerships can realize the benefits of having any form of an aligned workforce, there are several changes that must take place. As with any major organizational improvement, a c h i e v i n g management and employee alignment doesn’t happen on its own and certainly not overnight. It requires time and a full commitment from dealers, leaders, managers as well as employees! With all the changes needed to take place, the ultimate outcome will be different for each and every dealership and organization, the following tips can help dealerships seeking organizational Management and Employee Alignment:

organization.

• A good leader who takes the time to get to know the company inside and out has a higher probability of generating a plan that resonates with and for everyone.

COMMIT TO A REGIMENTED PERFORMANCE MANAGEMENT ALIGNMENT MONITORING PROCESS:

• Well-executed performance management alignment should include regular monitoring of critical performance indicators as well as discussion of daily achievements.

• Gaps against the goals shouldn’t be significant, and if they are, the goals should be reset.

• Progression against goal attainment will further engage and motivate employees, especially top performers • Consider rewarding them when they attain their performance targets.

FORMAL IMMERSION LEARNING INTEGRATION:

Success requires that all employee performance, management alignment and immersion learning initiatives need to be integrated and aligned with dealership and organizational objectives. If the two are separate, learning remains reactive and performance management is relegated to longer term performance appraisal which weakens performance and profitability. When these

variables are joined together, organizational growth, transformation, productivity and profitability results can be expected.

IT’S A CHALLENGING INITIATIVE:

Some of the biggest challenges for many of the dealership organizations that I visit lies in achieving total departmental and organizational alignment. Management Alignment is that missing but desired state in which the entire dealership and organization is working together to achieve all their metrics, critical performance indicators and business goals “intentionally!”

Just like the engine in a vehicle if the parts aren’t aligned with the other components and moving in the same direction at the same velocity, there will be no forward movement intentional performance cannot happen! Just one part can cause all this you ask? Absolutely! Unlike a vehicle, creating a management alignment culture in a dealership organization cannot and will not be achieved just by tinkering around with a few key components ad meeting for meeting sake.

THE BOTTOM LINE RESULT:

Management and employee alignment is all about attracting, developing, and retaining an employee workforce needed to meet and exceed current customer expectations and demands. If leadership is unable to create a clear blueprint that can be communicated and embraced throughout the dealership and organization, it will be much more difficult to establish a high-performing workforce able to meet those goals and Influence success.

ESTABLISH AND SET REALISTIC ATTAINABLE GOALS:

• For management alignment to be achieved, well-defined, and attainable goals should be established in such a way that they don’t have to be modified and revisited each month.

• Once meaningful, employee-specific goals have been put in place, those goals become a blueprint for the year, lending a strong sense of direction across the organization and to ensure progress advancement as well as determining if and when corrective action is required.

Success will come when all management and employee performance and learning initiatives are aligned.

INFLUENCE TRAINING THAT LINKS TO PERFORMANCE:

• Facts state that when dealership organizations link performance to learning, employees are able to expand their skill sets and reach personal and professional goals.

• This helps employees to better, understand the business priorities and how their skills are needed to achieve them.

INFLUENCE A STRONG LEADERSHIP CULTURE:

• Real management alignment requires strong leadership culture, capable of establishing a plan and selling it to the entire dealership and

TO SEE MORE FROM MICHAEL ROPPO GO TO CBTNEWS.COM

MICHAEL ROPPO

Director of Fixed Operations and Training /QPS Automotive Domain Results Michael has more than 30 years of experience providing consulting services to the auto dealer industry through Automotive Domain Results, a highly specialized practice with a mission is to help dealerships of all sizes achieve maximum profitability, customer satisfaction and retention. Through the implementation of Automotive Domain’s propriety tools, training and resources, he has helped countless dealers improve the quality of their management teams and the personnel who come in contact with their customers. Michael also brings the deep resources made available through Automotive Domain’s parent company, WithumSmith+Brown, CPAs, becoming a full service advisor to any auto dealer. Visit his website at AutomotiveDomainResults.com.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

15

ask THE

pros

A

t CBT News, we are fortunate to partner with the best trainers in the industry.

Whether it’s information on sales, F&I, marketing, management or fixed ops, our contributors are the go-to professionals for reliable, relevant advice for dealership personnel. You have access to the foremost authorities in the retail automotive industry. Need a new closing technique? Wondering what’s the best way to increase sales in the service lane? Send us your questions at AskThePros@ cbtnews.com. We’ll forward your inquiries to our ensemble of experts.

H

ow can we control the theft, damage and mileage risks if we start letting customers take vehicles home for overnight test drives?

-Sandy in Provo, UT

A: Bob Kain, general

manager of Jack Kain Ford Inc. in Versailles, KY:

O

ur dealership would like to augment our camera service by having one part-time officer patrol only the highest-risk areas during off-hours. How do we identify the high-risk zones?

-Ellen in Framingham, MA

A: Chip Walker, president of

Custom Facilities Inc.: Ellen, great question, but let’s back up for just one minute.

Are you happy with your cameras and their capabilities and recording capacities? A camera is a one-time expense, and they are never sick, work 24/7 and do not take breaks. But, if it is an older-style unit that will not pan, zoom and follow motions, then it will show you a long distance shot of a fuzzy figure in a lightcolored car and no license plate number, while he/ she is cutting off your catalytic converters! The new cameras are digital, can follow motion on your lot and can even send you an e-mail if they detect motion. Some will even allow you to log in during the action! Start here first.

Back to your question: The top three items stolen from lots, other than the entire car, are: 1) Highend rims and wheels, 2) catalytic converters, and 3) tailgates of pickup trucks. While most of the bad guys are very lazy and opportunistic, some are very good, experienced and have a plan to get what they want, and execute that plan very quickly.

Here are some tips: Make it hard to get to what they want. Use night-parkers on all entry and exit points to the lot. Make sure all of your lot lights work, and the timers, are properly set for the time of year. Use wheel locks on high-end rims and tires. Park your most desirable units on the front row closest to the street traffic. Block in your best units with other vehicles.

If all else fails, try to partner with your local police and ask for some extra drive-bys. Offer your service drive as a warming station for them to come in at night, warm up, get coffee and use the restroom. You might be amazed at the level of service you might get for being a good neighbor.

16

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Hi, Sandy. We as auto dealers are exposed to a great deal of risks with both dealership and customer vehicles every day – service loaners, sales test drives, technician test drives, demonstrators, etc. When it comes to an overnight test drive, the reward of a potential sale typically outweighs the risks that are involved with the test drive itself.

There are a number of risks involved that you have mentioned in your question, but the main risks you mentioned would be an accident or other damage done to your vehicle while in your customer’s possession. Although you can never alleviate all of the risks of an overnight test drive, you can greatly diminish your liability by having the customer sign a ‘borrowed vehicle agreement.’ We have used this form for the past two years, after an event in which a customer ran our vehicle into a ditch during a test drive.

We have the form signed before any test drives, loaner vehicles and any other event in which someone other than a dealership employee would be driving the vehicle.

Basically, the form holds the dealership harmless with any event that happens while the vehicle is in the customer’s care.

There have been two cases recently where the form has bailed us out on small fenderbenders, which occurred while the car was in our customer’s possession.

If excessive mileage is a concern of yours, then you could amend the form to include mileage limitations and charge the customer per-mile for going over. If you want to stay competitive in your market, overnight test drives are a must, and with the borrowed vehicle agreement, you can greatly limit your liability. If you would like a copy of the form we use, you can e-mail me at bob@kainford.com, and I’ll gladly send you a copy. Best of luck to you.

D

o you have any suggestions about ways to promote our service department for future service business, if we deliver a new vehicle to someone’s home or business instead of doing the deal at the store?

-Josh in Arlington, TX

A: Jeff Cowan, president of Jeff Cowan’s PRO TALK Inc.: Josh, whether your department delivers new vehicles at the dealership or to the customer’s home or place of business is inconsequential. You should have a full-fledged marketing program to promote your department, regardless of how you choose to deliver the product. Over time, I have discovered that a new vehicle inspection appointment is the best way to promote your service department.

Within three days of delivery, contact your new customer by his or her preferred method and offer the opportunity to visit your department when the vehicle hits the 1,000-mile mark. You should inform your customer that this visit is extremely important because it allows your staff and you to look over the vehicle to ensure there are no budding problems.

This should be referred to as a “new vehicle inspection.”

In your communication, you should strongly encourage your customer to schedule a check-in time to have this inspection preformed. Further explain that there are three parts to the process: Step One – The first 15 minutes of every visit will be spent showing the customer what will be addressed. This time will also include explaining your check-in process and how it works.

Step Two – This is when the vehicle will enter your state-of-the-art shop, where the actual inspection will occur.

Step Three – The vehicle is returned to the customer cleaned and shined, and with a full report card.

Following these simple steps will give you the opportunity to professionally welcome your new client to your store and provide him or her with the opportunity to become familiar with how you operate, why you are the best and what makes you different from your competitors. In addition, I would also send a small gift within three days of the delivery and start a monthly e-newsletter with advice and specials included. Follow up telephone calls and handwritten thank you notes from your staff also will work wonders for your business.

888.628.6779 | eleadsales@eleadcrm.com | www.elead-crm.com © Data Software Services, L.L.C. 2016

ask THE

pros

A

t CBT News, we are fortunate to partner with the best trainers in the industry.

Whether it’s information on sales, F&I, marketing, management or fixed ops, our contributors are the go-to professionals for reliable, relevant advice for dealership personnel. You have access to the foremost authorities in the retail automotive industry. Need a new closing technique? Wondering what’s the best way to increase sales in the service lane? Send us your questions at AskThePros@ cbtnews.com. We’ll forward your inquiries to our ensemble of experts.

H

ow can we control the theft, damage and mileage risks if we start letting customers take vehicles home for overnight test drives?

-Sandy in Provo, UT

A: Bob Kain, general

manager of Jack Kain Ford Inc. in Versailles, KY:

O

ur dealership would like to augment our camera service by having one part-time officer patrol only the highest-risk areas during off-hours. How do we identify the high-risk zones?

-Ellen in Framingham, MA

A: Chip Walker, president of

Custom Facilities Inc.: Ellen, great question, but let’s back up for just one minute.

Are you happy with your cameras and their capabilities and recording capacities? A camera is a one-time expense, and they are never sick, work 24/7 and do not take breaks. But, if it is an older-style unit that will not pan, zoom and follow motions, then it will show you a long distance shot of a fuzzy figure in a lightcolored car and no license plate number, while he/ she is cutting off your catalytic converters! The new cameras are digital, can follow motion on your lot and can even send you an e-mail if they detect motion. Some will even allow you to log in during the action! Start here first.

Back to your question: The top three items stolen from lots, other than the entire car, are: 1) Highend rims and wheels, 2) catalytic converters, and 3) tailgates of pickup trucks. While most of the bad guys are very lazy and opportunistic, some are very good, experienced and have a plan to get what they want, and execute that plan very quickly.

Here are some tips: Make it hard to get to what they want. Use night-parkers on all entry and exit points to the lot. Make sure all of your lot lights work, and the timers, are properly set for the time of year. Use wheel locks on high-end rims and tires. Park your most desirable units on the front row closest to the street traffic. Block in your best units with other vehicles.

If all else fails, try to partner with your local police and ask for some extra drive-bys. Offer your service drive as a warming station for them to come in at night, warm up, get coffee and use the restroom. You might be amazed at the level of service you might get for being a good neighbor.

16

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Hi, Sandy. We as auto dealers are exposed to a great deal of risks with both dealership and customer vehicles every day – service loaners, sales test drives, technician test drives, demonstrators, etc. When it comes to an overnight test drive, the reward of a potential sale typically outweighs the risks that are involved with the test drive itself.

There are a number of risks involved that you have mentioned in your question, but the main risks you mentioned would be an accident or other damage done to your vehicle while in your customer’s possession. Although you can never alleviate all of the risks of an overnight test drive, you can greatly diminish your liability by having the customer sign a ‘borrowed vehicle agreement.’ We have used this form for the past two years, after an event in which a customer ran our vehicle into a ditch during a test drive.

We have the form signed before any test drives, loaner vehicles and any other event in which someone other than a dealership employee would be driving the vehicle.

Basically, the form holds the dealership harmless with any event that happens while the vehicle is in the customer’s care.

There have been two cases recently where the form has bailed us out on small fenderbenders, which occurred while the car was in our customer’s possession.

If excessive mileage is a concern of yours, then you could amend the form to include mileage limitations and charge the customer per-mile for going over. If you want to stay competitive in your market, overnight test drives are a must, and with the borrowed vehicle agreement, you can greatly limit your liability. If you would like a copy of the form we use, you can e-mail me at bob@kainford.com, and I’ll gladly send you a copy. Best of luck to you.

D

o you have any suggestions about ways to promote our service department for future service business, if we deliver a new vehicle to someone’s home or business instead of doing the deal at the store?

-Josh in Arlington, TX

A: Jeff Cowan, president of Jeff Cowan’s PRO TALK Inc.: Josh, whether your department delivers new vehicles at the dealership or to the customer’s home or place of business is inconsequential. You should have a full-fledged marketing program to promote your department, regardless of how you choose to deliver the product. Over time, I have discovered that a new vehicle inspection appointment is the best way to promote your service department.

Within three days of delivery, contact your new customer by his or her preferred method and offer the opportunity to visit your department when the vehicle hits the 1,000-mile mark. You should inform your customer that this visit is extremely important because it allows your staff and you to look over the vehicle to ensure there are no budding problems.

This should be referred to as a “new vehicle inspection.”

In your communication, you should strongly encourage your customer to schedule a check-in time to have this inspection preformed. Further explain that there are three parts to the process: Step One – The first 15 minutes of every visit will be spent showing the customer what will be addressed. This time will also include explaining your check-in process and how it works.

Step Two – This is when the vehicle will enter your state-of-the-art shop, where the actual inspection will occur.

Step Three – The vehicle is returned to the customer cleaned and shined, and with a full report card.

Following these simple steps will give you the opportunity to professionally welcome your new client to your store and provide him or her with the opportunity to become familiar with how you operate, why you are the best and what makes you different from your competitors. In addition, I would also send a small gift within three days of the delivery and start a monthly e-newsletter with advice and specials included. Follow up telephone calls and handwritten thank you notes from your staff also will work wonders for your business.

888.628.6779 | eleadsales@eleadcrm.com | www.elead-crm.com © Data Software Services, L.L.C. 2016

SALES

Using good analytics provides rich, unbiased data.

You have a lot of data

NOW USE IT!

Look at your data for a targeted strategy that brings results

ad dollars or to change up the way you market that vehicle type or model, but thanks to the data provided by these OEM reports, you know that you need to try something different.

UTILIZE YOUR GOOGLE ANALYTICS DATA.

Most dealers have figured out by now that they must have Google Analytics on their website, and that’s because it allows them to access rich, robust and unbiased data. This is data you can use to market more efficiently and effectively as well.

One way that you can utilize Google Analytics to improve your marketing is through user segments.

You can isolate different parts of your website traffic to get a better idea of how that traffic is behaving. For example, you might choose to create a new segment that includes all users who have been to your site and visited the inventory page for a given model.

Why? Because it can give you better insight on how to market that model. You can see how

engaged the visitors to that model’s page are, and what they do after they visit the page. You can also look at the number of visitors or user sessions that page gets, and all this information together can help you better market the model.

If the page simply isn’t getting enough traffic, you may decide to redistribute your digital marketing dollars in order to spend more money driving traffic to the given model. If the visitors to the page don’t tend to convert, you may also decide to offer an incentive, like a gift card, in order to entice them to make a conversion. Once you gain information about your site visitors from these user segments in Google Analytics, you can make better informed decisions about your marketing.

“You might think there’s

no market for a type of vehicle or specific model in your area, when there actually is-- you’re just losing sales to your competitors.”

All in all, taking a look at the free data you already have can give you a better idea of how you can best reach the right customers with the right message at the right time. Don’t neglect this free data just because it isn’t Big Data.

Are you sure you are using your data correctly?

“The bottom line is that using data to break down your targeting by zip code allows you to determine how to best distribute your paid search dollars.”

BY AMY FARLEY

D

ata is a driving force in any dealer’s marketing strategy -- or at least, it should be. Because dealers can sometimes get bogged down thinking about Big Data and how it can be used, it’s easy to forget that the free, easily accessible data that you already have is incredibly valuable to utilize within your marketing.

So how can a dealer take advantage of free data to enhance and improve their marketing strategy?

We have a few tips that will help.

USE YOUR DATA FOR IMPROVED TARGETING

Data that you already have access to can help you target the right customers in all aspects of your marketing, from paid search to direct mail and more. To explain this, though, we’ll use an example that’s specific to paid search.

Most dealers and marketers, when implementing their paid search strategy, use radius targeting that extends out from a dealership in every direction to a given distance. This strategy is outdated and less effective than it could be.

The better way to do it is to use your data to devise an appropriate targeting strategy. Dealers can take a look at the data they already have to find out in which zip codes they are regularly selling and servicing vehicles, and on the other hand, in which zip codes they are not. They can then use this information to put more or less money in these zip codes.

In some cases, dealers discover that through radius targeting, they’ve been investing ad dollars

18

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

in areas where they’ve never sold a single car. In other cases, they find out that they haven’t been advertising at all in areas in which they’re still seeing a good deal of success. Investing more in those types of areas can result in even more sales and service opportunities. The bottom line is that using data to break down your targeting by zip code allows you to determine how to best distribute your paid search dollars.

purchase and will soon be in need of routine maintenance.

You can also try segmenting your list by the type of vehicle a customer owns. If you’re a Ford dealer who would like to send an email about the latest model Explorer, you may want to send it to drivers of SUVs and similar models, rather than customers who own compact cars.

This targeting strategy works for any kind of targeted marketing, though, not just paid search.

You may choose to revise the targeting of your mail campaigns or email campaigns as well once you see where you’re actually getting business and where you haven’t been all along.

Powering your email marketing campaigns with data can allow you to be more effective, because customers are much more likely to respond to emails that are tailored to them and their needs.

BETTER SEGMENTATION FOR YOUR EMAIL MARKETING

The reports that your OEM sends each month can give you insight into your market share.

These reports can provide you with valuable data that can help you adapt your strategy to be more effective.

Reaching out to the right customers with the right message is crucial for the effectiveness of your email marketing strategy, and your data can allow you to do this in a better way.

Not every email that your dealership sends needs to go out to your entire list. In fact, if you operate that way, you run the risk of exhausting your list and inviting unsubscribes or even spam reports. To avoid this, try segmentation.

You can use the data that you have in your Data Management System (DMS) to determine how to segment your list for each message. Certain messages might be best delivered to customers who are back in-market for a vehicle, having not made a purchase in a few years. Other messages (like service coupons) might be more successful when sent to someone who recently made a

TAKE A DEEPER LOOK AT YOUR OEM REPORTS.

For example, the report you get from your OEM for a given month may indicate that while you sold a decent number of trucks during the course of the month, your competitor, located just five miles down the road, sold three times as many. This may mean that there is a market for trucks that you aren’t tapping into nearly as much or as well as your competitor is, and you may want to revise your marketing plan to place more emphasis on trucks for the following month.

AMY FARLEY

Media and Communications Manager at Force Marketing Amy is a skilled writer and editor with a keen interest in digital trends and topics in the automotive industry.

She utilizes her knowledge of what is new in retail automotive marketing to help Force – an automotive digital, direct mail and email marketing firm based in Atlanta – with its evolution of the dealer-to-customer shopping experience. Visit the website at Forcemktg.com.

In some cases, you might think there’s no market for a type of vehicle or specific model in your area, when there actually is-- you’re just losing sales to your competitors. The key may be to invest more

TO SEE MORE FROM AMY FARLEY GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

19

SALES

Using good analytics provides rich, unbiased data.

You have a lot of data

NOW USE IT!

Look at your data for a targeted strategy that brings results

ad dollars or to change up the way you market that vehicle type or model, but thanks to the data provided by these OEM reports, you know that you need to try something different.

UTILIZE YOUR GOOGLE ANALYTICS DATA.

Most dealers have figured out by now that they must have Google Analytics on their website, and that’s because it allows them to access rich, robust and unbiased data. This is data you can use to market more efficiently and effectively as well.

One way that you can utilize Google Analytics to improve your marketing is through user segments.

You can isolate different parts of your website traffic to get a better idea of how that traffic is behaving. For example, you might choose to create a new segment that includes all users who have been to your site and visited the inventory page for a given model.

Why? Because it can give you better insight on how to market that model. You can see how

engaged the visitors to that model’s page are, and what they do after they visit the page. You can also look at the number of visitors or user sessions that page gets, and all this information together can help you better market the model.

If the page simply isn’t getting enough traffic, you may decide to redistribute your digital marketing dollars in order to spend more money driving traffic to the given model. If the visitors to the page don’t tend to convert, you may also decide to offer an incentive, like a gift card, in order to entice them to make a conversion. Once you gain information about your site visitors from these user segments in Google Analytics, you can make better informed decisions about your marketing.

“You might think there’s

no market for a type of vehicle or specific model in your area, when there actually is-- you’re just losing sales to your competitors.”

All in all, taking a look at the free data you already have can give you a better idea of how you can best reach the right customers with the right message at the right time. Don’t neglect this free data just because it isn’t Big Data.

Are you sure you are using your data correctly?

“The bottom line is that using data to break down your targeting by zip code allows you to determine how to best distribute your paid search dollars.”

BY AMY FARLEY

D

ata is a driving force in any dealer’s marketing strategy -- or at least, it should be. Because dealers can sometimes get bogged down thinking about Big Data and how it can be used, it’s easy to forget that the free, easily accessible data that you already have is incredibly valuable to utilize within your marketing.

So how can a dealer take advantage of free data to enhance and improve their marketing strategy?

We have a few tips that will help.

USE YOUR DATA FOR IMPROVED TARGETING

Data that you already have access to can help you target the right customers in all aspects of your marketing, from paid search to direct mail and more. To explain this, though, we’ll use an example that’s specific to paid search.

Most dealers and marketers, when implementing their paid search strategy, use radius targeting that extends out from a dealership in every direction to a given distance. This strategy is outdated and less effective than it could be.

The better way to do it is to use your data to devise an appropriate targeting strategy. Dealers can take a look at the data they already have to find out in which zip codes they are regularly selling and servicing vehicles, and on the other hand, in which zip codes they are not. They can then use this information to put more or less money in these zip codes.

In some cases, dealers discover that through radius targeting, they’ve been investing ad dollars

18

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

in areas where they’ve never sold a single car. In other cases, they find out that they haven’t been advertising at all in areas in which they’re still seeing a good deal of success. Investing more in those types of areas can result in even more sales and service opportunities. The bottom line is that using data to break down your targeting by zip code allows you to determine how to best distribute your paid search dollars.

purchase and will soon be in need of routine maintenance.

You can also try segmenting your list by the type of vehicle a customer owns. If you’re a Ford dealer who would like to send an email about the latest model Explorer, you may want to send it to drivers of SUVs and similar models, rather than customers who own compact cars.

This targeting strategy works for any kind of targeted marketing, though, not just paid search.

You may choose to revise the targeting of your mail campaigns or email campaigns as well once you see where you’re actually getting business and where you haven’t been all along.

Powering your email marketing campaigns with data can allow you to be more effective, because customers are much more likely to respond to emails that are tailored to them and their needs.

BETTER SEGMENTATION FOR YOUR EMAIL MARKETING

The reports that your OEM sends each month can give you insight into your market share.

These reports can provide you with valuable data that can help you adapt your strategy to be more effective.

Reaching out to the right customers with the right message is crucial for the effectiveness of your email marketing strategy, and your data can allow you to do this in a better way.

Not every email that your dealership sends needs to go out to your entire list. In fact, if you operate that way, you run the risk of exhausting your list and inviting unsubscribes or even spam reports. To avoid this, try segmentation.

You can use the data that you have in your Data Management System (DMS) to determine how to segment your list for each message. Certain messages might be best delivered to customers who are back in-market for a vehicle, having not made a purchase in a few years. Other messages (like service coupons) might be more successful when sent to someone who recently made a

TAKE A DEEPER LOOK AT YOUR OEM REPORTS.

For example, the report you get from your OEM for a given month may indicate that while you sold a decent number of trucks during the course of the month, your competitor, located just five miles down the road, sold three times as many. This may mean that there is a market for trucks that you aren’t tapping into nearly as much or as well as your competitor is, and you may want to revise your marketing plan to place more emphasis on trucks for the following month.

AMY FARLEY

Media and Communications Manager at Force Marketing Amy is a skilled writer and editor with a keen interest in digital trends and topics in the automotive industry.

She utilizes her knowledge of what is new in retail automotive marketing to help Force – an automotive digital, direct mail and email marketing firm based in Atlanta – with its evolution of the dealer-to-customer shopping experience. Visit the website at Forcemktg.com.

In some cases, you might think there’s no market for a type of vehicle or specific model in your area, when there actually is-- you’re just losing sales to your competitors. The key may be to invest more

TO SEE MORE FROM AMY FARLEY GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

19

TECHNOLOGY

The Year of

THE CALL Your Smartphone is the Smart Way to Bring in Customers

BY MIKE HAEG

‹ Handling phone calls correctly can mean the difference between a sale and a lost opportunity.

A

lot happened in 2015. David Letterman said farewell to The Late Show. Pop culture couldn’t decide if a simple dress was white and gold or blue and black. Dancing sharks took the spotlight at Katy Perry’s Super Bowl halftime performance.

It was a big year in the automotive world too.

AutoNation continued its expansion by gobbling up dealerships. Big players on the technology front acquired fresh companies. The industry set an all time record by selling 17,470,659 units.

And while sharks danced on and people sold tons of cars, dealership phones continued to ring.

And ring. And ring. Yes, 2015 truly was The Year of the Call as our proud industry realized that phone performance is the ultimate differentiator.

It separates the bad from the good, the good from the great, and the great from the best.

WHY IS THERE A HUGE UPTICK IN PHONE CALL VOLUME?

There are several factors leading to the tremendous growth we saw in 2015 phone call volume. Most notably, is that the smartphone in a shopper’s pocket provides an easy channel for

instant communication. According to Google, 48% of local searches called a local business. BIA Kelsey predicts that by 2018, mobile search will drive 73 billion phone calls to businesses, up from 30 billion in 2013.

The psychology of shoppers is changing too.

They want answers now. They want a price now.

They want availability now. They don’t want to wait and they definitely don’t want to play games. With research done at their fingertips, a simple phone call becomes a do-or-die way to rule dealerships out of the buying process.

Translation for dealerships: the phone isn’t going anywhere. Call volume is on the way up whether you like it or not.

If you’re concerned the store down the street is ramping up to take down local competition, you’re probably right.

The phone is an area of opportunity unlike anywhere else in the dealership. It consistently provides quality sales opportunities, yet has been quietly ignored the past several years. It can be improved with process and practice. It can be guided by data. Phone improvement allows the a dealership to create more opportunities out of the expensive leads already knocking on the door. This drive for maximum efficiency will be required to gain market share in the coming years.

HOW CAN YOU IMPROVE YOUR PHONE BUSINESS? IT’S SIMPLE: CRIPS

We learned in 2015 that phone complacency is not an option for dealerships. The stakes are simply too high.

A human review of over 8 million total phone calls (2 million inbound calls; 6 million outbound calls) showed that a few simple areas in the phone up process are ripe for major improvements. The quickest and easiest way for dealerships to get a boost is to get better on the phone.

The competition is getting bigger and better.

Dealership consolidation means the big players are investing heavily in training and sales processes.

These four areas include: Connect, Request/ Invite, Set, Pursue. In other words, just be CRISP on the phone.

IGNORE PHONE CALLS AT YOUR OWN RISK

“The biggest culprit for callers failing to reach someone is simply no one at the dealership being available to help.”

LET’S START WITH: CONNECT

The phone rings at your dealership and a receptionist picks up. Sounds good, right? What happens after the receptionist answers is a scary proposition. Of 2 million-plus inbound phone calls reviewed, only 61% actually reached someone at the dealership who could help the caller. This means that 39 out of every 100 calls at a dealership are left stranded.

Remind them where your store located, where to park, and what to do when entering the dealership. These friendly instructions actually help the shopper see themselves take part in the process of coming to the dealership. It builds commitment from the shopper, which means more shows and more opportunities to sell.

Converting that appointment request into a set firm appointment gets dealerships to the next level of phone performance.

The biggest culprit for callers failing to reach someone is simply no one at the dealership being available to help. The caller, who may or may not even leave a message, quickly goes from a hot to cold shopper status if you’re not there to help.

Other gaps in connecting calls include leaving shoppers on hold and bouncing them between departments.

END WITH THE “PURSUE:” PURSUE THE RIGHT PROSPECTS AT THE RIGHT TIME WITH THE RIGHT MESSAGES

The fastest way to increase the number of sales opportunities is to take advantage of the ones already knocking. Train receptionists to do a warm transfer. This means they stay on the call until someone who can actually help picks up and limits voicemails/hang ups. Also, anyone at the dealership who handles phone calls should be ready to say something like “Is there something that I can assist you with or would it be helpful to get a sales manager?” Remember that the ultimate goal is to keep that shopper in your reach!

The amount of true outbound live conversations is an ignored metric at dealerships that has tremendous influence on sales success. Don’t just smile and dial but instead actually speak with the intended prospect. In a study of 6 million-plus outbound phone calls, only 14% of outbound calls

A strong outbound phone culture will improve appointment percentages, re-engage cold leads, and get shoppers back in your store. This means pursuing the right prospects at the right time with the right message.

It starts with managing the right metric: Live Conversations. Out of all your outbound calls, how many actually reach the intended prospect?

Use this number as an indicator for success and use your CRM to find the right prospects.

Hot leads gone cold gone are a great place to start. Managers should also call to confirm set appointments and get shoppers excited for their visit. Sales agents shouldn’t smile and dial before 10 a.m. and be done for the day.

WE’RE NOW INTO 2016 AND CUSTOMERS ARE CALLING

2015 was an incredible year. Companies were bought and sold. Shoppers gobbled up new cars.

We were reminded that the quickest and easiest way for dealerships to get a boost is to get better on the phone. Don’t worry, the phone isn’t going anywhere in 2016.

The real question is can you afford to ignore it?

REQUEST / INVITE MEANS TO ASK FOR AN APPOINTMENT

The goal of every inbound sales call is to set an appointment. A surefire way for dealerships to see more appointments is to ask for them. Yes, it’s that simple.

Only 20% of inbound sales calls included an appointment request in a human review of 2 million-plus phone calls. These expensive and valuable opportunities aren’t even offered the privilege of experiencing your customer service in person!

Dealerships must build cultures focused on the phone. This starts at the top. Every sales meeting must include an emphasis on the appointment! Appointment request data should be shared throughout the dealership sales team.

Good performance should be applauded publicly, poor performance should be coached through individually.

‹ Potential customers want instant answers and assistance.

Make sure your dealership properly handles the calls.

“SET” UP AN APPOINTMENT AND SET THE EXPECTATIONS

“The phone is an area of opportunity unlike anywhere else in the dealership. It consistently provides quality sales opportunities, yet has been quietly ignored the past several years.”

actually connected to the intended party. The reality is that many sales agents just don’t put in the time or effort to execute strong outbound calling campaigns.

Asking for the appointment is the next easy missing ingredient for dealerships. The odds are actually in your favor since only 12% of appointment requests are fully declined. Make sure phone handlers offer two appointment times every time: “I have a 2:15 or 3:45 available. Which works best for you?”

MIKE HAEG

Director of Automotive at Century Interactive Mike’s company produces the Car Wars automotive call-tracking program. He loves fusing technology with people to help dealerships “own the phone.”

Once a firm appointment date/time is agreed upon, set an expectation for the shopper’s visit.

20

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

TO SEE MORE FROM MIKE HAEG GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

21

TECHNOLOGY

The Year of

THE CALL Your Smartphone is the Smart Way to Bring in Customers

BY MIKE HAEG

‹ Handling phone calls correctly can mean the difference between a sale and a lost opportunity.

A

lot happened in 2015. David Letterman said farewell to The Late Show. Pop culture couldn’t decide if a simple dress was white and gold or blue and black. Dancing sharks took the spotlight at Katy Perry’s Super Bowl halftime performance.

It was a big year in the automotive world too.

AutoNation continued its expansion by gobbling up dealerships. Big players on the technology front acquired fresh companies. The industry set an all time record by selling 17,470,659 units.

And while sharks danced on and people sold tons of cars, dealership phones continued to ring.

And ring. And ring. Yes, 2015 truly was The Year of the Call as our proud industry realized that phone performance is the ultimate differentiator.

It separates the bad from the good, the good from the great, and the great from the best.

WHY IS THERE A HUGE UPTICK IN PHONE CALL VOLUME?

There are several factors leading to the tremendous growth we saw in 2015 phone call volume. Most notably, is that the smartphone in a shopper’s pocket provides an easy channel for

instant communication. According to Google, 48% of local searches called a local business. BIA Kelsey predicts that by 2018, mobile search will drive 73 billion phone calls to businesses, up from 30 billion in 2013.

The psychology of shoppers is changing too.

They want answers now. They want a price now.

They want availability now. They don’t want to wait and they definitely don’t want to play games. With research done at their fingertips, a simple phone call becomes a do-or-die way to rule dealerships out of the buying process.

Translation for dealerships: the phone isn’t going anywhere. Call volume is on the way up whether you like it or not.

If you’re concerned the store down the street is ramping up to take down local competition, you’re probably right.

The phone is an area of opportunity unlike anywhere else in the dealership. It consistently provides quality sales opportunities, yet has been quietly ignored the past several years. It can be improved with process and practice. It can be guided by data. Phone improvement allows the a dealership to create more opportunities out of the expensive leads already knocking on the door. This drive for maximum efficiency will be required to gain market share in the coming years.

HOW CAN YOU IMPROVE YOUR PHONE BUSINESS? IT’S SIMPLE: CRIPS

We learned in 2015 that phone complacency is not an option for dealerships. The stakes are simply too high.

A human review of over 8 million total phone calls (2 million inbound calls; 6 million outbound calls) showed that a few simple areas in the phone up process are ripe for major improvements. The quickest and easiest way for dealerships to get a boost is to get better on the phone.

The competition is getting bigger and better.

Dealership consolidation means the big players are investing heavily in training and sales processes.

These four areas include: Connect, Request/ Invite, Set, Pursue. In other words, just be CRISP on the phone.

IGNORE PHONE CALLS AT YOUR OWN RISK

“The biggest culprit for callers failing to reach someone is simply no one at the dealership being available to help.”

LET’S START WITH: CONNECT

The phone rings at your dealership and a receptionist picks up. Sounds good, right? What happens after the receptionist answers is a scary proposition. Of 2 million-plus inbound phone calls reviewed, only 61% actually reached someone at the dealership who could help the caller. This means that 39 out of every 100 calls at a dealership are left stranded.

Remind them where your store located, where to park, and what to do when entering the dealership. These friendly instructions actually help the shopper see themselves take part in the process of coming to the dealership. It builds commitment from the shopper, which means more shows and more opportunities to sell.

Converting that appointment request into a set firm appointment gets dealerships to the next level of phone performance.

The biggest culprit for callers failing to reach someone is simply no one at the dealership being available to help. The caller, who may or may not even leave a message, quickly goes from a hot to cold shopper status if you’re not there to help.

Other gaps in connecting calls include leaving shoppers on hold and bouncing them between departments.

END WITH THE “PURSUE:” PURSUE THE RIGHT PROSPECTS AT THE RIGHT TIME WITH THE RIGHT MESSAGES

The fastest way to increase the number of sales opportunities is to take advantage of the ones already knocking. Train receptionists to do a warm transfer. This means they stay on the call until someone who can actually help picks up and limits voicemails/hang ups. Also, anyone at the dealership who handles phone calls should be ready to say something like “Is there something that I can assist you with or would it be helpful to get a sales manager?” Remember that the ultimate goal is to keep that shopper in your reach!

The amount of true outbound live conversations is an ignored metric at dealerships that has tremendous influence on sales success. Don’t just smile and dial but instead actually speak with the intended prospect. In a study of 6 million-plus outbound phone calls, only 14% of outbound calls

A strong outbound phone culture will improve appointment percentages, re-engage cold leads, and get shoppers back in your store. This means pursuing the right prospects at the right time with the right message.

It starts with managing the right metric: Live Conversations. Out of all your outbound calls, how many actually reach the intended prospect?

Use this number as an indicator for success and use your CRM to find the right prospects.

Hot leads gone cold gone are a great place to start. Managers should also call to confirm set appointments and get shoppers excited for their visit. Sales agents shouldn’t smile and dial before 10 a.m. and be done for the day.

WE’RE NOW INTO 2016 AND CUSTOMERS ARE CALLING

2015 was an incredible year. Companies were bought and sold. Shoppers gobbled up new cars.

We were reminded that the quickest and easiest way for dealerships to get a boost is to get better on the phone. Don’t worry, the phone isn’t going anywhere in 2016.

The real question is can you afford to ignore it?

REQUEST / INVITE MEANS TO ASK FOR AN APPOINTMENT

The goal of every inbound sales call is to set an appointment. A surefire way for dealerships to see more appointments is to ask for them. Yes, it’s that simple.

Only 20% of inbound sales calls included an appointment request in a human review of 2 million-plus phone calls. These expensive and valuable opportunities aren’t even offered the privilege of experiencing your customer service in person!

Dealerships must build cultures focused on the phone. This starts at the top. Every sales meeting must include an emphasis on the appointment! Appointment request data should be shared throughout the dealership sales team.

Good performance should be applauded publicly, poor performance should be coached through individually.

‹ Potential customers want instant answers and assistance.

Make sure your dealership properly handles the calls.

“SET” UP AN APPOINTMENT AND SET THE EXPECTATIONS

“The phone is an area of opportunity unlike anywhere else in the dealership. It consistently provides quality sales opportunities, yet has been quietly ignored the past several years.”

actually connected to the intended party. The reality is that many sales agents just don’t put in the time or effort to execute strong outbound calling campaigns.

Asking for the appointment is the next easy missing ingredient for dealerships. The odds are actually in your favor since only 12% of appointment requests are fully declined. Make sure phone handlers offer two appointment times every time: “I have a 2:15 or 3:45 available. Which works best for you?”

MIKE HAEG

Director of Automotive at Century Interactive Mike’s company produces the Car Wars automotive call-tracking program. He loves fusing technology with people to help dealerships “own the phone.”

Once a firm appointment date/time is agreed upon, set an expectation for the shopper’s visit.

20

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

TO SEE MORE FROM MIKE HAEG GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

21

IT

determine what your IT needs are today, and what they will be a year from now.

IT Downtime May

3

Money Savings. Dealerships that work with MSPs discover that the monthly fees they pay are more than made up for by the increase in efficiencies and reduced downtime.

Cost Your Dealership Over $200K Per Year: Here’s How to Fix It.

4

5

Peace of Mind.

MSPs are knowledgeable when it comes to the latest security requirements and will always keep your enterprise up-to-date with the latest and greatest security protections. The threats of hackers, malware, spyware, viruses and phishing scams are growing every day, and many dealerships have experienced attacks in one form or another. Dealing with these security breaches can be very expensive and timeconsuming. When you work with a MSP, security becomes their problem instead of your problem, so you can sleep at night.

There are Several Approaches to find Your Issue’s Main Cause

BY ERIK NACHBAHR

W

hen technology works correctly, your dealership runs smoothly and efficiently.

People only notice technology when they don’t know how to do something or when something isn’t working.

The problem with IT issues is that when it comes to fixing them, there is no “one prescription fits all.” Most problems require troubleshooting, and it can take several approaches to diagnose an issue’s root cause.

Many dealerships (and businesses in general) operate in a “putting out fires” mode. When the network goes down, panic ensues. Frantic phone calls are placed to the IT support staff or to vendors. Productivity screeches to a halt until the problem is fixed. Dollars are recklessly thrown at the problem to get it fixed ASAP. This approach is both aggravating and expensive. A 2015 Infonetics survey of medium to large businesses found that on average, companies lose $4 million per year or approximately one-half of one percent of their total revenue, due to IT downtime.

The average auto dealership has a much smaller enterprise than the companies surveyed by Infonetics, but if you apply that percentage, you can come up with an estimate for the annual cost of your IT downtime: ✔ According to NADA Data 2014, total revenue from all new-car dealerships in 2014 was $806 billion ✔ Data for the report was taken from 16,396 new-car dealerships ✔ Average revenue per dealership is $49,158,331 ✔ Average revenue multiplied by one-half of one percent is approximately $245,791

22

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Happier Employees. MSPs have large in-house staffs that include specialists in every area.

This means that even if several of your employees are having problems, they can all get the expert help they need instantly, instead of having to wait until your in-house IT staff becomes available.

That’s how much your IT downtime could be costing your dealership every year, and that’s per dealership! Auto groups with four, five or ten dealerships can multiply accordingly.

In addition to security breaches, MSPs can deliver peace of mind with disaster recovery plans.

The good news is there are ways to reduce IT downtime and the associated expense. The main reason why there is so much downtime is because dealerships tend to be reactive to IT issues, rather than proactive. Many dealerships don’t have fulltime IT staff, or they don’t have enough IT staff to handle both the day-to-day issues listed above, and also to research, implement and monitor technology solutions designed to prevent sever crashes, network outages, security breaches and other problems.

Adding more IT staff is one solution to become more proactive. Another solution may be to outsource some or all of your IT needs.

MANAGED SERVICES PROVIDERS (MSP) PROVIDE A PROACTIVE APPROACH

Dealerships that experience IT downtime on a regular basis may want to consider outsourcing to a Managed Services Provider (MSP). MSPs provide strategic planning, recommendations, installation, maintenance and support for all of a dealership’s IT needs. Many MSPs offer a subscription model for a flat monthly fee, making it easy for dealerships to plan for and control spending.

Additional benefits of working with an MSP include: Increased Efficiency. Network issues that users may not be aware of yet are instantly and automatically reported to the MSP, allowing remediation to start before problems occur. No more “putting out fires.”

2

6

Focus on Your Core Business. Every manager has limited time and attention. Every minute that a manager spends dealing with an IT issue is a minute spent away from selling or servicing cars, training and mentoring employees or keeping your customers happy.

Every dealership has different IT needs, so you’ll have to determine what is most beneficial for your business. While vetting an MSP, ask them to create a cost analysis for you to specifically find out how they can impact your dealership. Also, make sure to look for the “extras”. Do their business hours align with yours? Do they offer dedicated support?

How is their customer service? These additional offerings can make a difference between building a partnership versus just tacking on other vendor.

A proactive approach to dealing with IT needs reduces downtime and aggravation, while increasing efficiency and adding a significant chunk of change to the bottom line.

MOST COMMON IT ISSUES IN DEALERSHIPS • Glitches with DMS or third party software • Receiving spam or malicious email • Malware/virus on computer • Loss of access to DMS, CRM, website and other applications • Slow Internet • Internet outages • Weak wireless • Wireless connectivity problems • Extended downtime during hardware failures • Can't print to printer of choice • Browser incompatibility • Lack of shared data resources • Antiquated inter-dealership communication (phone and email only) • No fluid response to new OEM initiatives (security, hardware/software requirements, renovations) List compiled from Helion's Help Desk

1

Strategic Planning. As dealerships grow and become increasingly more dependent on the Internet, IT requirements change. An MSP can

If your dealership is damaged by a storm, flood or other event, your MSP will have a redundancy protocol in place so that you can keep operating.

If you do experience downtime, the MSP will have you up and running sooner rather than later.

ERIK NACHBAHR

President and CEO of Helion Technologies Erik’s company, which he founded in 1997, provides IT strategies to auto dealerships. He individually works as chief information officer for clients with a combined billions of dollars in annual revenue. See the website at www.heliontechnologies.com.

If your team can’t handle IT problems, consider outsourcing to a Managed Services Provider.

TO SEE MORE FROM ERIK NACHBAHR GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

23

IT

determine what your IT needs are today, and what they will be a year from now.

IT Downtime May

3

Money Savings. Dealerships that work with MSPs discover that the monthly fees they pay are more than made up for by the increase in efficiencies and reduced downtime.

Cost Your Dealership Over $200K Per Year: Here’s How to Fix It.

4

5

Peace of Mind.

MSPs are knowledgeable when it comes to the latest security requirements and will always keep your enterprise up-to-date with the latest and greatest security protections. The threats of hackers, malware, spyware, viruses and phishing scams are growing every day, and many dealerships have experienced attacks in one form or another. Dealing with these security breaches can be very expensive and timeconsuming. When you work with a MSP, security becomes their problem instead of your problem, so you can sleep at night.

There are Several Approaches to find Your Issue’s Main Cause

BY ERIK NACHBAHR

W

hen technology works correctly, your dealership runs smoothly and efficiently.

People only notice technology when they don’t know how to do something or when something isn’t working.

The problem with IT issues is that when it comes to fixing them, there is no “one prescription fits all.” Most problems require troubleshooting, and it can take several approaches to diagnose an issue’s root cause.

Many dealerships (and businesses in general) operate in a “putting out fires” mode. When the network goes down, panic ensues. Frantic phone calls are placed to the IT support staff or to vendors. Productivity screeches to a halt until the problem is fixed. Dollars are recklessly thrown at the problem to get it fixed ASAP. This approach is both aggravating and expensive. A 2015 Infonetics survey of medium to large businesses found that on average, companies lose $4 million per year or approximately one-half of one percent of their total revenue, due to IT downtime.

The average auto dealership has a much smaller enterprise than the companies surveyed by Infonetics, but if you apply that percentage, you can come up with an estimate for the annual cost of your IT downtime: ✔ According to NADA Data 2014, total revenue from all new-car dealerships in 2014 was $806 billion ✔ Data for the report was taken from 16,396 new-car dealerships ✔ Average revenue per dealership is $49,158,331 ✔ Average revenue multiplied by one-half of one percent is approximately $245,791

22

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Happier Employees. MSPs have large in-house staffs that include specialists in every area.

This means that even if several of your employees are having problems, they can all get the expert help they need instantly, instead of having to wait until your in-house IT staff becomes available.

That’s how much your IT downtime could be costing your dealership every year, and that’s per dealership! Auto groups with four, five or ten dealerships can multiply accordingly.

In addition to security breaches, MSPs can deliver peace of mind with disaster recovery plans.

The good news is there are ways to reduce IT downtime and the associated expense. The main reason why there is so much downtime is because dealerships tend to be reactive to IT issues, rather than proactive. Many dealerships don’t have fulltime IT staff, or they don’t have enough IT staff to handle both the day-to-day issues listed above, and also to research, implement and monitor technology solutions designed to prevent sever crashes, network outages, security breaches and other problems.

Adding more IT staff is one solution to become more proactive. Another solution may be to outsource some or all of your IT needs.

MANAGED SERVICES PROVIDERS (MSP) PROVIDE A PROACTIVE APPROACH

Dealerships that experience IT downtime on a regular basis may want to consider outsourcing to a Managed Services Provider (MSP). MSPs provide strategic planning, recommendations, installation, maintenance and support for all of a dealership’s IT needs. Many MSPs offer a subscription model for a flat monthly fee, making it easy for dealerships to plan for and control spending.

Additional benefits of working with an MSP include: Increased Efficiency. Network issues that users may not be aware of yet are instantly and automatically reported to the MSP, allowing remediation to start before problems occur. No more “putting out fires.”

2

6

Focus on Your Core Business. Every manager has limited time and attention. Every minute that a manager spends dealing with an IT issue is a minute spent away from selling or servicing cars, training and mentoring employees or keeping your customers happy.

Every dealership has different IT needs, so you’ll have to determine what is most beneficial for your business. While vetting an MSP, ask them to create a cost analysis for you to specifically find out how they can impact your dealership. Also, make sure to look for the “extras”. Do their business hours align with yours? Do they offer dedicated support?

How is their customer service? These additional offerings can make a difference between building a partnership versus just tacking on other vendor.

A proactive approach to dealing with IT needs reduces downtime and aggravation, while increasing efficiency and adding a significant chunk of change to the bottom line.

MOST COMMON IT ISSUES IN DEALERSHIPS • Glitches with DMS or third party software • Receiving spam or malicious email • Malware/virus on computer • Loss of access to DMS, CRM, website and other applications • Slow Internet • Internet outages • Weak wireless • Wireless connectivity problems • Extended downtime during hardware failures • Can't print to printer of choice • Browser incompatibility • Lack of shared data resources • Antiquated inter-dealership communication (phone and email only) • No fluid response to new OEM initiatives (security, hardware/software requirements, renovations) List compiled from Helion's Help Desk

1

Strategic Planning. As dealerships grow and become increasingly more dependent on the Internet, IT requirements change. An MSP can

If your dealership is damaged by a storm, flood or other event, your MSP will have a redundancy protocol in place so that you can keep operating.

If you do experience downtime, the MSP will have you up and running sooner rather than later.

ERIK NACHBAHR

President and CEO of Helion Technologies Erik’s company, which he founded in 1997, provides IT strategies to auto dealerships. He individually works as chief information officer for clients with a combined billions of dollars in annual revenue. See the website at www.heliontechnologies.com.

If your team can’t handle IT problems, consider outsourcing to a Managed Services Provider.

TO SEE MORE FROM ERIK NACHBAHR GO TO CBTNEWS.COM

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

23

ASSOCIATIONnews NADA ROLLS OUT A NEW LOOK WITH A NEW LOGO

The National Automobile Dealers Association is banking on the truth behind the old saying, “A picture is worth a thousand words.”

Tysons, Va.-based NADA recently overhauled its corporate logo to convey a more modern look and provide a cohesive image throughout the association’s advertising, signage, presentations and various digital communications. At the same time, NADA redesigned its sub-brand logos – such as those for the its academy, annual convention & expo and retirement program – to more closely align with the primary logo.

Also as part of the rebranding effort, NADA renamed its political action committee as the NADA PAC from the previous Dealers Election Action Committee (DEAC). NADA’s is the nation’s third-largest trade association PAC based on total contributions.

VEHICLES HONORED FOR THEIR POPULARITY WITH MINORITY BUYERS

The National Association of Minority Automobile Dealers, in conjunction with IHS Automotive, gave out its first Diversity Volume Leadership Awards at the North American International Auto Show in Detroit in January. The awards were based on personal new vehicle registrations by racial minority, woman and millennial customers.

The “ethnic volume leaders” noted by Largo, Md.-based NAMAD and IHS were: Great Lakes region, Chevrolet Equinox; Mideast region, Honda Accord; New England region, Toyota RAV4; Plains region, Toyota RAV4; Rocky Mountain region, RAM Ram; Southeast region, Toyota Corolla; Southwest region, Chevrolet Silverado; and Western region, Honda Civic.

In the category of volume leaders for millennials and women, the Honda CR-V was tapped the top women’s vehicle, Lexus RX as the top women’s luxury vehicle and Honda Accord as the top ethnic millennial vehicle.

Finally, volume leaders were announced by ethnic group. The top-selling vehicles overall were: for African-Americans, Toyota Camry; for Hispanics, Toyota Corolla; for Asian-Pacific Islanders, Toyota Camry; and for Native Americans, Chevrolet Silverado. Top luxury vehicles by ethnic group were: for African-Americans, Mercedes-Benz C-Class; for Hispanics, Lexus IS; for Asian-Pacific Islanders, Lexus RX; and for Native Americans, Buick Verano.

The overall top ethnic vehicle, luxury or non-luxury, was the Toyota Corolla.

PREPARATIONS LAUNCHED FOR SECOND ‘WOMEN IN AUTOMOTIVE’ EVENT The second annual “Women in Automotive” conference has been scheduled for June 26-28 in Orlando, Fla. Sponsors of the 2015 inaugural event included the Florida Automobile Dealers Association and Women’s Automotive Association International, among others.

As with last year’s conference, the focus will be on exposing automakers, dealers and vendors to ideas and trends affecting the industry’s employment of, and vehicle sales to, women.

Conference organizers hope to double last year’s attendance of 300, and the event has been expanded to 2 ½ days of keynote speeches, seminars and workshops, according to founder Christy Roman. “Women in Automotive” will be held at the Omni Orlando Resort at ChampionsGate.

VIRGINIA ASSOCIATION SEEKS MODIFICATIONS TO STATE RECALL LAWS

The Virginia Automobile Dealers Association planned to lobby for refinements of state laws governing vehicle recalls and dealership franchises, when state lawmakers returned to Richmond in January.

In a VADA e-newsletter advancing the 2016 General Assembly session, President and CEO Don Hall said he will seek legal changes that provide “common sense solutions” that take “care of the dealers and consumers who ultimately have to deal with the problem of recalls.” For example, VADA will push for the use of a disclosure form that Virginia dealers would have to give car buyers and that would alert them to any open recalls on the car they want.

“What we do not need is to prohibit consumers from being able to purchase a car based on a recall for something minor that has nothing to do with the drivability or safety of the vehicle,” Hall added.

PRESENTERS WANTED FOR SERVICE PROFESSIONAL ASSOCIATION CONFERENCE The Automotive Service Association is inviting professionals in the independent automotive service and collision repair sector to make proposals about giving a presentation at the 2016 NACE | CARS Expo & Conference.

That trade show will be held Aug. 9-13 in Anaheim, Calif. Interested presenters have to complete a call for presentations form, which can be accessed at http://bit.ly/1YM3neT. The North Richland Hills, Texas-based ASA is the largest non-profit trade association for independent automotive service and repair professionals.

LEADERSHIP IS IN PLACE FOR AUTOMOTIVE FINANCE GROUP The National Automotive Finance Association named its 2015-16 executive committee, a 25-member board of directors and two exofficio members.

OUR PROPRIETARY TECH-ENABLED MULTI-CHANNEL MARKETING PLATFORM HELPS DEALERS REACH AND ENGAGE WITH CAR-SHOPPERS ALONG THE ENTIRE PATH TO PURCHASE. VISIT FORCEMKTG.COM/TECHOLOGY TO LEARN MORE.

Current executive committee members for Hanover, Md.-based NAFA include President Mark Floyd of Exeter Finance Corp., VP Scot Seagrave of AFS Acceptance, VP Ian Anderson of Westlake Financial, Chairman Steve Hall of driversselect, Secretary Gary Schultz of Chase Auto Finance and Treasurer Jim Bass of Car Champs Finance LLC.

STATE’S NEGATIVE EQUITY DISCLOSURE FORM DRAWS ATTENTION

Given Vermont’s small size and stature among the states, its interesting that an agency’s proposed revisions to a required disclosure form for negative equity in vehicle retain installment contracts is attracting a lot of attention.

TECHNOLOGY

We’re backed by innovative technology that lets us more effectively deliver results.

DATA

Your DMS data, CRM data and other data sources combine to dictate a strategy that works.

MULTI-CHANNEL

Our strategy allows you to reach customers through multiple marketing mediums.

In recent weeks, the Washington-based American Financial Services Association submitted a comment letter to the Vermont Department of Financial Regulation. As the agency tries to clarify the meaning and calculation of “cash price,” AFSA wants additional clarification of whether rebates must be deducted from that cash price.

Plus, AFSA argues the associated regulation should be amended to limit the form’s use to vehicles designed for use on public highways, and asks for additional time for its creditor members to make changes to existing contracts concerning a new list of optional items that must be included in cash price.

ForceMarketing.com | Atlanta • New York | 866-854-2815 24

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

ASSOCIATIONnews NADA ROLLS OUT A NEW LOOK WITH A NEW LOGO

The National Automobile Dealers Association is banking on the truth behind the old saying, “A picture is worth a thousand words.”

Tysons, Va.-based NADA recently overhauled its corporate logo to convey a more modern look and provide a cohesive image throughout the association’s advertising, signage, presentations and various digital communications. At the same time, NADA redesigned its sub-brand logos – such as those for the its academy, annual convention & expo and retirement program – to more closely align with the primary logo.

Also as part of the rebranding effort, NADA renamed its political action committee as the NADA PAC from the previous Dealers Election Action Committee (DEAC). NADA’s is the nation’s third-largest trade association PAC based on total contributions.

VEHICLES HONORED FOR THEIR POPULARITY WITH MINORITY BUYERS

The National Association of Minority Automobile Dealers, in conjunction with IHS Automotive, gave out its first Diversity Volume Leadership Awards at the North American International Auto Show in Detroit in January. The awards were based on personal new vehicle registrations by racial minority, woman and millennial customers.

The “ethnic volume leaders” noted by Largo, Md.-based NAMAD and IHS were: Great Lakes region, Chevrolet Equinox; Mideast region, Honda Accord; New England region, Toyota RAV4; Plains region, Toyota RAV4; Rocky Mountain region, RAM Ram; Southeast region, Toyota Corolla; Southwest region, Chevrolet Silverado; and Western region, Honda Civic.

In the category of volume leaders for millennials and women, the Honda CR-V was tapped the top women’s vehicle, Lexus RX as the top women’s luxury vehicle and Honda Accord as the top ethnic millennial vehicle.

Finally, volume leaders were announced by ethnic group. The top-selling vehicles overall were: for African-Americans, Toyota Camry; for Hispanics, Toyota Corolla; for Asian-Pacific Islanders, Toyota Camry; and for Native Americans, Chevrolet Silverado. Top luxury vehicles by ethnic group were: for African-Americans, Mercedes-Benz C-Class; for Hispanics, Lexus IS; for Asian-Pacific Islanders, Lexus RX; and for Native Americans, Buick Verano.

The overall top ethnic vehicle, luxury or non-luxury, was the Toyota Corolla.

PREPARATIONS LAUNCHED FOR SECOND ‘WOMEN IN AUTOMOTIVE’ EVENT The second annual “Women in Automotive” conference has been scheduled for June 26-28 in Orlando, Fla. Sponsors of the 2015 inaugural event included the Florida Automobile Dealers Association and Women’s Automotive Association International, among others.

As with last year’s conference, the focus will be on exposing automakers, dealers and vendors to ideas and trends affecting the industry’s employment of, and vehicle sales to, women.

Conference organizers hope to double last year’s attendance of 300, and the event has been expanded to 2 ½ days of keynote speeches, seminars and workshops, according to founder Christy Roman. “Women in Automotive” will be held at the Omni Orlando Resort at ChampionsGate.

VIRGINIA ASSOCIATION SEEKS MODIFICATIONS TO STATE RECALL LAWS

The Virginia Automobile Dealers Association planned to lobby for refinements of state laws governing vehicle recalls and dealership franchises, when state lawmakers returned to Richmond in January.

In a VADA e-newsletter advancing the 2016 General Assembly session, President and CEO Don Hall said he will seek legal changes that provide “common sense solutions” that take “care of the dealers and consumers who ultimately have to deal with the problem of recalls.” For example, VADA will push for the use of a disclosure form that Virginia dealers would have to give car buyers and that would alert them to any open recalls on the car they want.

“What we do not need is to prohibit consumers from being able to purchase a car based on a recall for something minor that has nothing to do with the drivability or safety of the vehicle,” Hall added.

PRESENTERS WANTED FOR SERVICE PROFESSIONAL ASSOCIATION CONFERENCE The Automotive Service Association is inviting professionals in the independent automotive service and collision repair sector to make proposals about giving a presentation at the 2016 NACE | CARS Expo & Conference.

That trade show will be held Aug. 9-13 in Anaheim, Calif. Interested presenters have to complete a call for presentations form, which can be accessed at http://bit.ly/1YM3neT. The North Richland Hills, Texas-based ASA is the largest non-profit trade association for independent automotive service and repair professionals.

LEADERSHIP IS IN PLACE FOR AUTOMOTIVE FINANCE GROUP The National Automotive Finance Association named its 2015-16 executive committee, a 25-member board of directors and two exofficio members.

OUR PROPRIETARY TECH-ENABLED MULTI-CHANNEL MARKETING PLATFORM HELPS DEALERS REACH AND ENGAGE WITH CAR-SHOPPERS ALONG THE ENTIRE PATH TO PURCHASE. VISIT FORCEMKTG.COM/TECHOLOGY TO LEARN MORE.

Current executive committee members for Hanover, Md.-based NAFA include President Mark Floyd of Exeter Finance Corp., VP Scot Seagrave of AFS Acceptance, VP Ian Anderson of Westlake Financial, Chairman Steve Hall of driversselect, Secretary Gary Schultz of Chase Auto Finance and Treasurer Jim Bass of Car Champs Finance LLC.

STATE’S NEGATIVE EQUITY DISCLOSURE FORM DRAWS ATTENTION

Given Vermont’s small size and stature among the states, its interesting that an agency’s proposed revisions to a required disclosure form for negative equity in vehicle retain installment contracts is attracting a lot of attention.

TECHNOLOGY

We’re backed by innovative technology that lets us more effectively deliver results.

DATA

Your DMS data, CRM data and other data sources combine to dictate a strategy that works.

MULTI-CHANNEL

Our strategy allows you to reach customers through multiple marketing mediums.

In recent weeks, the Washington-based American Financial Services Association submitted a comment letter to the Vermont Department of Financial Regulation. As the agency tries to clarify the meaning and calculation of “cash price,” AFSA wants additional clarification of whether rebates must be deducted from that cash price.

Plus, AFSA argues the associated regulation should be amended to limit the form’s use to vehicles designed for use on public highways, and asks for additional time for its creditor members to make changes to existing contracts concerning a new list of optional items that must be included in cash price.

ForceMarketing.com | Atlanta • New York | 866-854-2815 24

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Berg with parts manager Joe Mudaro and service manager Linda Garelli.

DEALERSHIP PROFILE

FUTURE SERVICE WORK FIGURED PROMINENTLY IN

SUNRISE TOYOTA’S REDESIGN

Jimmy Berg’s Long Island store overhaul addressed big needs in the store he bought several years ago.

BY JON MCKENNA

T

hat vehicle service generates the lion’s share of profits at most U.S. dealerships is a reality not lost on Jimmy Berg, the president of two stores on Long Island.

A complete remaking of the service department figured prominently in the $10 million reconstruction of Sunrise Toyota, in the town of Oakdale about 50 miles from Manhattan. The project opened to customers last summer with 38 service bays, seven detailing bays and a three-lane service drive. Such improvements might not be visible to passing motorists, but they offer a stark contrast to the tattered Toyota dealership that Berg bought in 2008.

“It was just kind of slapped together,” said Berg, who also runs the Sunrise Chevrolet in Queens and 26

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

a small MV-1 wheelchair-accessible taxi business.

“We had bays in an out building, and customers would have to wait in line and pull under the canopy when we would move a car up. We couldn’t add technicians. We couldn’t sell more service.

“The quality of the service was okay, but we still weren’t giving people the customer service they deserved.”

More Service Lanes Help

Today, Sunrise Toyota uses two interior lanes to line up cars for checks of the wheel alignment, tire tread depth and battery charge (information service advisors have when they sit down to write up a customer) and the third for repair and service jobs.

Tire changes, wheel balancings and brake-lift work is handled in a walled-in area in the middle, which also keeps shavings away from the other work areas.

Berg reports his stores produced more than $100 million of revenue in 2015, including sales of about 2,800 new and 1,200 used vehicles.

“Now, we can probably get 40 cars in there, out of the rain, the cold, the snow, the heat,” enthused Berg, a veteran dealer who relocated to greater New York City from suburban Baltimore. “The advisors are right there next to the lanes. Plus, we added eight or nine techs.”

As for tooling, Berg, after touring about a dozen dealerships around the country for ideas, opted four in-ground lifts, which reduced worries about ground contamination and allowed room for four additional bays. He invested in new tire-changers, wheel-balancers, brake lathes and other equipment, plus a dedicated locker room and bathroom for the service staff.

“My philosophy is, give them a great place to work with all of the state-of-the-art tools, and they’ll do their job and take care of their customers. Technicians are hard to find in this market, and I think we’ve been able to add a few of them specifically because we’ve built the nicest facility on the Island.”

Repaying The Investment

Great, but what kind of ROI was needed to costjustify such an investment in service? By his own description, Berg is a “back-of-the-napkin kind of guy” who is building for the long term (his son, Aaron, is the COO). However, he estimated that a 30 percent increase in service repair orders and parts sales, on a consistent basis, would cover the expansion debt apart from any gains in vehicle sales.

So far, Sunrise Toyota already has achieved the 30 percent uptick in daily service ROs, on a samemonth comparison basis, he said. Meanwhile, new car sales increased nearly 22 percent last year, which he attributes in large part to more attractive new and used car showrooms and various customer service features.

Cracking The Greater N.Y. Market

Berg, who has more than 25 years of experience in retail automotive, left his role as VP of the Len Stoler Automotive Group in Owings Mills, Md., to take a crack at the greater New York market (“It’s not for the faint of heart”) and his own store. He opened the Chevrolet dealership in 2013.

All told, the Toyota expansion took floor space to 75,000 square feet from 30,000 square feet, on an 11acre site. At any given time, it may have 800 to 1,000 new and used Toyotas in stock.

Other Aspects Of The Project

Apart from the service drive improvements, the store’s overhaul, designed by local architect Gary Bruno, included: • Expanded showrooms with 30-foot ceilings.

vehicles in 2015, and rang up more than $100 million of total revenue.

Ambitions For Customer Experience

While CSI scores and Google star ratings jumped nicely after the expansion opened in June 2015, looking ahead, he wants to take the Toyota store up a couple of notches more in customer experience.

He has added to the new facilities with a couple of flourishes like free manicures at the dealership, but next in line for this year are a complete sales process handled on a salesperson’s tablet and reassignment of cashiering duties to the advisor.

“I want to give the customer the Apple Store experience,” Berg remarked. “I have the facility for it, now I need the technology.”

“Technicians are hard to find in this market, and I think we’ve been able to add a few of them specifically because we’ve built

the nicest facility on the Island.”

- Jimmy Berg

• Three waiting rooms – one for adult customers, one for kids and one as a quiet area for working while they wait.

• A $600,000 investment in interior and exterior LED lighting.

• A customer café that will open soon and be supplied by a local deli.

“This is a very competitive market,” Berg said of Long Island, which has seven other dealerships, the closest of which to Sunrise is about eight miles in a straight line. “You can’t stay in this business going into the future with an old car facility. You can hang in there and milk that cow until the end, but to really be successful in the future, you need to have a facility that customers are comfortable in and employees are proud to come to. You need to give them nice.”

Berg reports his company sold about 2,800 new and 1,200 used

Photos by Larry Hacken

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

27

Berg with parts manager Joe Mudaro and service manager Linda Garelli.

DEALERSHIP PROFILE

FUTURE SERVICE WORK FIGURED PROMINENTLY IN

SUNRISE TOYOTA’S REDESIGN

Jimmy Berg’s Long Island store overhaul addressed big needs in the store he bought several years ago.

BY JON MCKENNA

T

hat vehicle service generates the lion’s share of profits at most U.S. dealerships is a reality not lost on Jimmy Berg, the president of two stores on Long Island.

A complete remaking of the service department figured prominently in the $10 million reconstruction of Sunrise Toyota, in the town of Oakdale about 50 miles from Manhattan. The project opened to customers last summer with 38 service bays, seven detailing bays and a three-lane service drive. Such improvements might not be visible to passing motorists, but they offer a stark contrast to the tattered Toyota dealership that Berg bought in 2008.

“It was just kind of slapped together,” said Berg, who also runs the Sunrise Chevrolet in Queens and 26

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

a small MV-1 wheelchair-accessible taxi business.

“We had bays in an out building, and customers would have to wait in line and pull under the canopy when we would move a car up. We couldn’t add technicians. We couldn’t sell more service.

“The quality of the service was okay, but we still weren’t giving people the customer service they deserved.”

More Service Lanes Help

Today, Sunrise Toyota uses two interior lanes to line up cars for checks of the wheel alignment, tire tread depth and battery charge (information service advisors have when they sit down to write up a customer) and the third for repair and service jobs.

Tire changes, wheel balancings and brake-lift work is handled in a walled-in area in the middle, which also keeps shavings away from the other work areas.

Berg reports his stores produced more than $100 million of revenue in 2015, including sales of about 2,800 new and 1,200 used vehicles.

“Now, we can probably get 40 cars in there, out of the rain, the cold, the snow, the heat,” enthused Berg, a veteran dealer who relocated to greater New York City from suburban Baltimore. “The advisors are right there next to the lanes. Plus, we added eight or nine techs.”

As for tooling, Berg, after touring about a dozen dealerships around the country for ideas, opted four in-ground lifts, which reduced worries about ground contamination and allowed room for four additional bays. He invested in new tire-changers, wheel-balancers, brake lathes and other equipment, plus a dedicated locker room and bathroom for the service staff.

“My philosophy is, give them a great place to work with all of the state-of-the-art tools, and they’ll do their job and take care of their customers. Technicians are hard to find in this market, and I think we’ve been able to add a few of them specifically because we’ve built the nicest facility on the Island.”

Repaying The Investment

Great, but what kind of ROI was needed to costjustify such an investment in service? By his own description, Berg is a “back-of-the-napkin kind of guy” who is building for the long term (his son, Aaron, is the COO). However, he estimated that a 30 percent increase in service repair orders and parts sales, on a consistent basis, would cover the expansion debt apart from any gains in vehicle sales.

So far, Sunrise Toyota already has achieved the 30 percent uptick in daily service ROs, on a samemonth comparison basis, he said. Meanwhile, new car sales increased nearly 22 percent last year, which he attributes in large part to more attractive new and used car showrooms and various customer service features.

Cracking The Greater N.Y. Market

Berg, who has more than 25 years of experience in retail automotive, left his role as VP of the Len Stoler Automotive Group in Owings Mills, Md., to take a crack at the greater New York market (“It’s not for the faint of heart”) and his own store. He opened the Chevrolet dealership in 2013.

All told, the Toyota expansion took floor space to 75,000 square feet from 30,000 square feet, on an 11acre site. At any given time, it may have 800 to 1,000 new and used Toyotas in stock.

Other Aspects Of The Project

Apart from the service drive improvements, the store’s overhaul, designed by local architect Gary Bruno, included: • Expanded showrooms with 30-foot ceilings.

vehicles in 2015, and rang up more than $100 million of total revenue.

Ambitions For Customer Experience

While CSI scores and Google star ratings jumped nicely after the expansion opened in June 2015, looking ahead, he wants to take the Toyota store up a couple of notches more in customer experience.

He has added to the new facilities with a couple of flourishes like free manicures at the dealership, but next in line for this year are a complete sales process handled on a salesperson’s tablet and reassignment of cashiering duties to the advisor.

“I want to give the customer the Apple Store experience,” Berg remarked. “I have the facility for it, now I need the technology.”

“Technicians are hard to find in this market, and I think we’ve been able to add a few of them specifically because we’ve built

the nicest facility on the Island.”

- Jimmy Berg

• Three waiting rooms – one for adult customers, one for kids and one as a quiet area for working while they wait.

• A $600,000 investment in interior and exterior LED lighting.

• A customer café that will open soon and be supplied by a local deli.

“This is a very competitive market,” Berg said of Long Island, which has seven other dealerships, the closest of which to Sunrise is about eight miles in a straight line. “You can’t stay in this business going into the future with an old car facility. You can hang in there and milk that cow until the end, but to really be successful in the future, you need to have a facility that customers are comfortable in and employees are proud to come to. You need to give them nice.”

Berg reports his company sold about 2,800 new and 1,200 used

Photos by Larry Hacken

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

27

SALES

What The

“[Utilize] the right technology that combines the

SONIC AUTOMOTIVE EXPERIMENTS

most appealing aspects of online shopping and in-

Can Teach Other Dealerships

dealership experiences, offering consumers an efficient, transparent and pressure-free shopping.”

High-tech and time-saving initiatives show how dealers can and must use technology to improve customer experiences.

BY TODD MARCELLE

A

s a result of low gas prices and favorable economic forecasts, the U.S. consumer proved to be in a car buying mood in 2015, pushing the U.S. auto industry to a new sales record. According to government and industry reports, consumers bought 17.5 million cars and light trucks in the domestic market, surpassing the previous record (set in 2000) by 68,138 vehicles.

By the time most customers enter a dealership, they have already done considerable homework online and by now are looking for an expedited sales process. In fact, a 2015 Accenture survey found that 75 percent of drivers polled would consider undergoing the entire car shopping process online – a sentiment that hasn’t gone unnoticed by a number of new companies that are offering just that experience.

However, since national economies and oil prices can change seemingly overnight, dealers must constantly look for new ways to get Americans into new vehicles.

TECHNOLOGY CAN AUGMENT ON-SITE EXPERIENCES

The traditional car buying experience is simply no more. As consumers have grown more dependent on the Internet and technology in every facet of their lives, nearly every industry has had to adapt to meet their needs and demands.

Auto dealerships are no different.

So, how can dealerships that remain primarily brick-and-mortar operations compete? They can do it by utilizing the right technology that combines the most appealing aspects of online shopping and in-dealership experiences, offering consumers an efficient, transparent and pressurefree shopping.

The J.D. Power 2015 U.S. Sales Satisfaction

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Sonic also has pioneered the “one Sonic – one experience” concept in its franchised dealer locations. Here, Sonic’s goal is to restrict the entire vehicle purchase experience to 45 minutes or less thanks to no-haggle pricing and assignment of just one salesperson and an iPad from start to finish.

According to that study, customers preferred interacting with sales personnel who used a tablet to guide the sales process from start to finish.

Conversely, customers had a negative reaction to handwritten price quotes. These trends clearly point to a consumer desire for a slick, seamless and technology driven car buying process.

To some in the industry, these findings should serve as a wake-up call to change dealerships’ practices and processes. To others, they confirm that their new business model has turned out to be the right one.

Research shows that a sales process using a tablet from start to finish resonates with car shoppers.

28

Kiosks and digital display boards provide still more transparency to dealership customers.

Index (SSI) Survey findings noted that, “Given an increasingly tech-savvy consumer, dealerships that integrate technology tools into their sales process deliver a superior customer experience.

Dealers that fail to invest in consumer-facing technologies risk being trumped by competitors.”

NO-VISIT TECHNOLOGIES FIND FANS WHAT SONIC IS DOING

Leading the way is Charlotte, N.C.-based Sonic Automotive, one of the nation’s largest dealership groups. At three locations already up and running in the Denver area and several others planned for this year, Sonic has developed a revolutionary concept that combines technology with the personalized and seamless experience consumers crave.

It remains to be seen how quickly these concepts might spread across the country and push traditional dealers to think outside the box, but it’s safe to say that Sonic has touched a nerve.

However, plenty of disruptors are waiting in the wings for their own piece of the pie. Companies such as Beepi, Carvana and Vroom use different business models but all offer consumers a way to purchase used vehicles without stepping foot inside a dealership.

Inside the EchoPark Automotive dealership, where Sonic sells used cars, customers are greeted by seven “open consultation” stations offering comfortable seating and tables. No cars or salespeople are in sight. Additionally, a large screen that Sonic calls the “imagine bar” hangs above the showroom. Customers use iPads to search the dealership’s inventory and launch the vehicle’s image onto that large screen to get a better view.

A consumer walking into a traditional dealership to start a car purchase can expect to spend nearly four hours – and sometimes longer.

This amount of time simply is not sustainable anymore, when a slew of new and faster options beckon to customers. Dealerships must recognize the tide shift, change their cultures and make the necessary investments in their infrastructures to redesign and enhance brick-and-mortar stores to meet the needs of car buyers in the 21st Century.

Should customers require a salesperson’s assistance, they can tap on the tablet to summon one who can answer their questions and guide them as necessary. And, the back of the store features a cozy fireplace, an open view of the service bays and a microphone station from which customers can pose questions to service technicians.

MAKE SMALL CHANGES IF YOU MUST, BUT DO CHANGE

Upping the ante, all of the EchoPark Automotive store’s service prices, and those of its local competitors, are posted on large digital display boards for all to see, adding still transparency to the overall experience.

Based on customer reaction inside the stores and their sentiments expressed on social media to date, this concept appeals to them. Meanwhile, TO SEE MORE FROM TODD MARCELLE GO TO CBTNEWS.COM

While there are a number of ways dealers can “future-proof” their dealerships, the scale of those improvements depends on the store’s size. Yet, it’s important for dealers to recognize they need to

make improvements and begin to implement even small changes over time.

Whether they completely eliminate the F&I office, combine desking (products that mine, track and analyze lenders’ lease and finance programs via a tablet or other portable device) with a salesperson’s guidance to bring the negotiation process out of the back room, or integrate tablets and touch kiosks to transform showrooms, the goal is to retire the tired, old showroom experience and transform it into something enjoyable and seamless.

By integrating technology into the sales process through the use of cloud-based, customizable software, dealers can capture their customers’ contact information from the start, assign salespeople, track ad sourcing. As evidenced by Sonic’s EchoPark Automotive concept, consumers also can use it to research vehicles, value trades, browse dealer incentives and connect directly with dealers’ CRM systems. These types of tools entice buyers to take immediate action while on the showroom floor, during the test drive or in the service lane, translating to real-time results for dealers.

AT DAY’S END, PEOPLE WANT PERSONALIZATION

Although 2016 no doubt will bring a number of unknowns and new industry disruptors, one constant remains – consumers still want to physically touch the cars and take them for a test drive. I’m not arguing buyers want a completely virtual experience. Consumers simply are looking for a seamless, personalized experience that will save them time and provide a sense of control in choosing their dream car.

Dealerships that best provide a new technologydriven experience will quickly outpace their competition and ensure their own survival.

TODD MARCELLE

CEO and Founder of GoMoto Todd founded three previous start-ups before GoMoto, which provides cloud-based customer engagement products like display board software that are designed to enhance customer experiences in dealership showrooms and service waiting areas. See the website at www.shopgomoto.com.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

29

SALES

What The

“[Utilize] the right technology that combines the

SONIC AUTOMOTIVE EXPERIMENTS

most appealing aspects of online shopping and in-

Can Teach Other Dealerships

dealership experiences, offering consumers an efficient, transparent and pressure-free shopping.”

High-tech and time-saving initiatives show how dealers can and must use technology to improve customer experiences.

BY TODD MARCELLE

A

s a result of low gas prices and favorable economic forecasts, the U.S. consumer proved to be in a car buying mood in 2015, pushing the U.S. auto industry to a new sales record. According to government and industry reports, consumers bought 17.5 million cars and light trucks in the domestic market, surpassing the previous record (set in 2000) by 68,138 vehicles.

By the time most customers enter a dealership, they have already done considerable homework online and by now are looking for an expedited sales process. In fact, a 2015 Accenture survey found that 75 percent of drivers polled would consider undergoing the entire car shopping process online – a sentiment that hasn’t gone unnoticed by a number of new companies that are offering just that experience.

However, since national economies and oil prices can change seemingly overnight, dealers must constantly look for new ways to get Americans into new vehicles.

TECHNOLOGY CAN AUGMENT ON-SITE EXPERIENCES

The traditional car buying experience is simply no more. As consumers have grown more dependent on the Internet and technology in every facet of their lives, nearly every industry has had to adapt to meet their needs and demands.

Auto dealerships are no different.

So, how can dealerships that remain primarily brick-and-mortar operations compete? They can do it by utilizing the right technology that combines the most appealing aspects of online shopping and in-dealership experiences, offering consumers an efficient, transparent and pressurefree shopping.

The J.D. Power 2015 U.S. Sales Satisfaction

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Sonic also has pioneered the “one Sonic – one experience” concept in its franchised dealer locations. Here, Sonic’s goal is to restrict the entire vehicle purchase experience to 45 minutes or less thanks to no-haggle pricing and assignment of just one salesperson and an iPad from start to finish.

According to that study, customers preferred interacting with sales personnel who used a tablet to guide the sales process from start to finish.

Conversely, customers had a negative reaction to handwritten price quotes. These trends clearly point to a consumer desire for a slick, seamless and technology driven car buying process.

To some in the industry, these findings should serve as a wake-up call to change dealerships’ practices and processes. To others, they confirm that their new business model has turned out to be the right one.

Research shows that a sales process using a tablet from start to finish resonates with car shoppers.

28

Kiosks and digital display boards provide still more transparency to dealership customers.

Index (SSI) Survey findings noted that, “Given an increasingly tech-savvy consumer, dealerships that integrate technology tools into their sales process deliver a superior customer experience.

Dealers that fail to invest in consumer-facing technologies risk being trumped by competitors.”

NO-VISIT TECHNOLOGIES FIND FANS WHAT SONIC IS DOING

Leading the way is Charlotte, N.C.-based Sonic Automotive, one of the nation’s largest dealership groups. At three locations already up and running in the Denver area and several others planned for this year, Sonic has developed a revolutionary concept that combines technology with the personalized and seamless experience consumers crave.

It remains to be seen how quickly these concepts might spread across the country and push traditional dealers to think outside the box, but it’s safe to say that Sonic has touched a nerve.

However, plenty of disruptors are waiting in the wings for their own piece of the pie. Companies such as Beepi, Carvana and Vroom use different business models but all offer consumers a way to purchase used vehicles without stepping foot inside a dealership.

Inside the EchoPark Automotive dealership, where Sonic sells used cars, customers are greeted by seven “open consultation” stations offering comfortable seating and tables. No cars or salespeople are in sight. Additionally, a large screen that Sonic calls the “imagine bar” hangs above the showroom. Customers use iPads to search the dealership’s inventory and launch the vehicle’s image onto that large screen to get a better view.

A consumer walking into a traditional dealership to start a car purchase can expect to spend nearly four hours – and sometimes longer.

This amount of time simply is not sustainable anymore, when a slew of new and faster options beckon to customers. Dealerships must recognize the tide shift, change their cultures and make the necessary investments in their infrastructures to redesign and enhance brick-and-mortar stores to meet the needs of car buyers in the 21st Century.

Should customers require a salesperson’s assistance, they can tap on the tablet to summon one who can answer their questions and guide them as necessary. And, the back of the store features a cozy fireplace, an open view of the service bays and a microphone station from which customers can pose questions to service technicians.

MAKE SMALL CHANGES IF YOU MUST, BUT DO CHANGE

Upping the ante, all of the EchoPark Automotive store’s service prices, and those of its local competitors, are posted on large digital display boards for all to see, adding still transparency to the overall experience.

Based on customer reaction inside the stores and their sentiments expressed on social media to date, this concept appeals to them. Meanwhile, TO SEE MORE FROM TODD MARCELLE GO TO CBTNEWS.COM

While there are a number of ways dealers can “future-proof” their dealerships, the scale of those improvements depends on the store’s size. Yet, it’s important for dealers to recognize they need to

make improvements and begin to implement even small changes over time.

Whether they completely eliminate the F&I office, combine desking (products that mine, track and analyze lenders’ lease and finance programs via a tablet or other portable device) with a salesperson’s guidance to bring the negotiation process out of the back room, or integrate tablets and touch kiosks to transform showrooms, the goal is to retire the tired, old showroom experience and transform it into something enjoyable and seamless.

By integrating technology into the sales process through the use of cloud-based, customizable software, dealers can capture their customers’ contact information from the start, assign salespeople, track ad sourcing. As evidenced by Sonic’s EchoPark Automotive concept, consumers also can use it to research vehicles, value trades, browse dealer incentives and connect directly with dealers’ CRM systems. These types of tools entice buyers to take immediate action while on the showroom floor, during the test drive or in the service lane, translating to real-time results for dealers.

AT DAY’S END, PEOPLE WANT PERSONALIZATION

Although 2016 no doubt will bring a number of unknowns and new industry disruptors, one constant remains – consumers still want to physically touch the cars and take them for a test drive. I’m not arguing buyers want a completely virtual experience. Consumers simply are looking for a seamless, personalized experience that will save them time and provide a sense of control in choosing their dream car.

Dealerships that best provide a new technologydriven experience will quickly outpace their competition and ensure their own survival.

TODD MARCELLE

CEO and Founder of GoMoto Todd founded three previous start-ups before GoMoto, which provides cloud-based customer engagement products like display board software that are designed to enhance customer experiences in dealership showrooms and service waiting areas. See the website at www.shopgomoto.com.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

29

SALES

Dealers Should o T d e W e m o c e Not B

Static Sales Lead Forms

ractive te in , y rl e p ro p d e iz g te Stra tions s e u q e s o p s rm fo d a le feel the that make consumers r. dealership is a partne

BY RUSS CHANDLER

D

ealership Internet managers have two primary goals. The first obviously is to sell cars. The second goal (not to be confused as a secondary goal) is to collect leads in order to build better customer relationships, so that you can sell more cars. One of the main ways dealers try to attain these leads is by setting up a form for consumers to schedule test drives, get price alerts and learn about upcoming sales events.

The biggest issue dealers run into with these forms is that consumers often regard them as a trap. They think to themselves, “After I submit my contact information, I’m not gonna stop hearing from them about buying something.” Let’s face it, you probably don’t like being badgered, either.

No one does!

While they have some successes, static form leads increasingly have become a problem as car shoppers caught on to the “mousetrap” strategy of controlling access to information by requiring that customer contact data be submitted.

In lieu of these static forms, many businesses over the last decade have adopted different methods of interactive lead capture. AutoTrader, Kelley Blue Book and Edmunds.com are just a few of them. Your dealership may well have worked interactive lead capture into its own online marketing strategy. These lead-generation tools have changed the way consumers shop for vehicles, and they’ve improved the way buyers interact with dealerships.

UNREALISTIC FEARS OF INTERACTIVE FORMS

The most common concern about interactive lead capture that I’ve heard from dealers is that they’re afraid consumers won’t engage long enough to completely share information and generate a real lead; resulting in low conversion rates. They worry consumers will lack the patience to even begin filling out the tool.

In reality, the static forms make consumers feel like they are being lured into a mousetrap, because dealers aren’t asking for information that could help the consumer. In contrast, along with the standard request for contact information, many interactive tools will pose questions like “What car are you currently driving?” “Are you looking for a new or used vehicle?” “What is the condition of your current vehicle?” or “What type of car are you looking for?”

Rather than creating a “trap,” you’d be creating a participatory experience that essentially lets consumers create the type of profile

that highlights the majority of their wants and needs. Their mindset becomes that the information they provide will help the dealership’s guys help THEM with their purchasing decisions.

This is why it’s called interactive lead capture – the interactive content being the multiple choice questions, drop-down menus and so on. By extending the amount of time a customer spends interacting with you on your website, you are actually “warming up” the lead and helping drive the consumer to your dealership to buy.

Acccording to Demand Metric survey benchmarks, interactive content is 94.4 percent more effective than static content at generating conversions. In a nutshell, trust is built simply by giving attention to the customer’s needs.

STEPS A DEALER CAN TAKE

PRINCIPLE NO. 1: NEVER OVERLOOK DESIGN In developing a lead-generation strategy, the first thing a dealership will want to take into consideration is overall platform design. Because your website should directly reflect what a consumer would experience at the dealership, you’ll want to be as sleek and professional looking as possible. Thus, a consumer will regard your business as more trustworthy and legitimate.

I have seen many dealers apply this principle but not carry it all the way through into lead generation.

The improvements I’m seeing in dealership home page design, branding and content-interactivity (e.g., video or savvy animation) can and should be applied to the actual lead capture form or tools.

PRINCIPLE NO. 2: ASK QUESTIONS THAT MAKE SENSE

caught on to the ‘mousetrap’ strategy of

What questions could a dealership ask that would directly benefit the consumer? If you really want to dive deep and learn more about your customer, you might consider customizing some of the questions. You’ll actually have a better chance of getting a response.

controlling access to information.”

30

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Here are some examples of the types of questions I mean:

Will this customer believe the information he is about to provide will actually benefit him down the line?

This is the sort of question that a car customer is more likely to answer.

So, what can your dealership specifically do to move beyond cookie-cutter lead generation tools and static forms? There are a few key principles that I feel every dealer should take into deep consideration before committing to a lead strategy.

Along with use of your own logos and color schemes, multimedia elements such as animated GIFs, videos, audio files and other media can help your dealership stand out from the crowd – especially if they tell consumers more about your dealership and why they should share information.

“Static form leads increasingly have become a problem as car shoppers

“What else can we help you with?”

“What best describes where you are in the buying process?”

A) Beginning; I’m still researching to find out what I want B) Middle; I’ve narrowed my search to what I want but I’m still comparing options C) End; I know what I want and am ready to make a purchase “What else can we help you with?”

A) Financing TO SEE MORE FROM RUSS CHANDLER GO TO CBTNEWS.COM

B) Deciding which vehicle is right for me C) I have very little spare time D) The vehicle I want is not in inventory “What is the next best step for you?”

A) Continue browsing inventory B) Schedule a test drive C) Get pre-approved D) General research Additionally, consumers like to feel like they’re in control of their purchasing decisions, and letting them set up their own questions encourages that feeling. A good example is asking them how they’d prefer to be contacted. Simply letting someone choose from among “E-Mail,” “Phone,” “Text” or “Mail” makes him or her feel better about filling out a form.

PRINCIPLE NO. 3: CONSIDER CREATING YOUR OWN TOOL You might consider customizing your lead tool beyond the basics, although that might seem a little intimidating at first. I’m talking about going beyond basic configuration to develop features or enhancements specific to your dealership’s strategy.

When was the last time you wished your current leads included some insights into what your customer is not getting, or had some other feature?

Today’s technology allows for cost-effective product development. What use to take weeks or months to build now can be done in less than a day, and it’s only getting easier. If your current provider doesn’t offer the features you want, ask the company to create them.

What do consumers experience in the showroom that could be experienced on your website? What special steps do you take for your showroom visitors that could be tied into your website, using technology? This might mean enhancing your website to with a new functionality, integration or targeting capability. Think about your pricing, sales, financing or delivery process and properly reflect it online in your lead generation strategy.

YOU HAVE LOTS OF OPTIONS

As you continue your hunt for the perfect interactive lead generation strategy, recognize that you have a nearly infinite number of options from which to choose. There’s no need to rush when it comes to implementing a lead generation tool onto your website. Whether you choose to leverage a third-party tool or seek the help of a coder or website designer to create one, you need to make sure it suits your dealership’s current needs.

“By extending the

amount of time a customer spends interacting with you on your website, you are actually “warming up” the lead and helping drive the consumer to your dealership to buy.”

RUSS CHANDLER

Product Marketing Manager at PERQ LLC Russ has more than 11 years of experience in auto sales, dealership digital marketing and technology product sales. In his current job, he leads the sales and marketing of automotive apps powered by FATWIN for PERQ, a consumer engagement technology provider.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

31

SALES

Dealers Should o T d e W e m o c e Not B

Static Sales Lead Forms

ractive te in , y rl e p ro p d e iz g te Stra tions s e u q e s o p s rm fo d a le feel the that make consumers r. dealership is a partne

BY RUSS CHANDLER

D

ealership Internet managers have two primary goals. The first obviously is to sell cars. The second goal (not to be confused as a secondary goal) is to collect leads in order to build better customer relationships, so that you can sell more cars. One of the main ways dealers try to attain these leads is by setting up a form for consumers to schedule test drives, get price alerts and learn about upcoming sales events.

The biggest issue dealers run into with these forms is that consumers often regard them as a trap. They think to themselves, “After I submit my contact information, I’m not gonna stop hearing from them about buying something.” Let’s face it, you probably don’t like being badgered, either.

No one does!

While they have some successes, static form leads increasingly have become a problem as car shoppers caught on to the “mousetrap” strategy of controlling access to information by requiring that customer contact data be submitted.

In lieu of these static forms, many businesses over the last decade have adopted different methods of interactive lead capture. AutoTrader, Kelley Blue Book and Edmunds.com are just a few of them. Your dealership may well have worked interactive lead capture into its own online marketing strategy. These lead-generation tools have changed the way consumers shop for vehicles, and they’ve improved the way buyers interact with dealerships.

UNREALISTIC FEARS OF INTERACTIVE FORMS

The most common concern about interactive lead capture that I’ve heard from dealers is that they’re afraid consumers won’t engage long enough to completely share information and generate a real lead; resulting in low conversion rates. They worry consumers will lack the patience to even begin filling out the tool.

In reality, the static forms make consumers feel like they are being lured into a mousetrap, because dealers aren’t asking for information that could help the consumer. In contrast, along with the standard request for contact information, many interactive tools will pose questions like “What car are you currently driving?” “Are you looking for a new or used vehicle?” “What is the condition of your current vehicle?” or “What type of car are you looking for?”

Rather than creating a “trap,” you’d be creating a participatory experience that essentially lets consumers create the type of profile

that highlights the majority of their wants and needs. Their mindset becomes that the information they provide will help the dealership’s guys help THEM with their purchasing decisions.

This is why it’s called interactive lead capture – the interactive content being the multiple choice questions, drop-down menus and so on. By extending the amount of time a customer spends interacting with you on your website, you are actually “warming up” the lead and helping drive the consumer to your dealership to buy.

Acccording to Demand Metric survey benchmarks, interactive content is 94.4 percent more effective than static content at generating conversions. In a nutshell, trust is built simply by giving attention to the customer’s needs.

STEPS A DEALER CAN TAKE

PRINCIPLE NO. 1: NEVER OVERLOOK DESIGN In developing a lead-generation strategy, the first thing a dealership will want to take into consideration is overall platform design. Because your website should directly reflect what a consumer would experience at the dealership, you’ll want to be as sleek and professional looking as possible. Thus, a consumer will regard your business as more trustworthy and legitimate.

I have seen many dealers apply this principle but not carry it all the way through into lead generation.

The improvements I’m seeing in dealership home page design, branding and content-interactivity (e.g., video or savvy animation) can and should be applied to the actual lead capture form or tools.

PRINCIPLE NO. 2: ASK QUESTIONS THAT MAKE SENSE

caught on to the ‘mousetrap’ strategy of

What questions could a dealership ask that would directly benefit the consumer? If you really want to dive deep and learn more about your customer, you might consider customizing some of the questions. You’ll actually have a better chance of getting a response.

controlling access to information.”

30

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Here are some examples of the types of questions I mean:

Will this customer believe the information he is about to provide will actually benefit him down the line?

This is the sort of question that a car customer is more likely to answer.

So, what can your dealership specifically do to move beyond cookie-cutter lead generation tools and static forms? There are a few key principles that I feel every dealer should take into deep consideration before committing to a lead strategy.

Along with use of your own logos and color schemes, multimedia elements such as animated GIFs, videos, audio files and other media can help your dealership stand out from the crowd – especially if they tell consumers more about your dealership and why they should share information.

“Static form leads increasingly have become a problem as car shoppers

“What else can we help you with?”

“What best describes where you are in the buying process?”

A) Beginning; I’m still researching to find out what I want B) Middle; I’ve narrowed my search to what I want but I’m still comparing options C) End; I know what I want and am ready to make a purchase “What else can we help you with?”

A) Financing TO SEE MORE FROM RUSS CHANDLER GO TO CBTNEWS.COM

B) Deciding which vehicle is right for me C) I have very little spare time D) The vehicle I want is not in inventory “What is the next best step for you?”

A) Continue browsing inventory B) Schedule a test drive C) Get pre-approved D) General research Additionally, consumers like to feel like they’re in control of their purchasing decisions, and letting them set up their own questions encourages that feeling. A good example is asking them how they’d prefer to be contacted. Simply letting someone choose from among “E-Mail,” “Phone,” “Text” or “Mail” makes him or her feel better about filling out a form.

PRINCIPLE NO. 3: CONSIDER CREATING YOUR OWN TOOL You might consider customizing your lead tool beyond the basics, although that might seem a little intimidating at first. I’m talking about going beyond basic configuration to develop features or enhancements specific to your dealership’s strategy.

When was the last time you wished your current leads included some insights into what your customer is not getting, or had some other feature?

Today’s technology allows for cost-effective product development. What use to take weeks or months to build now can be done in less than a day, and it’s only getting easier. If your current provider doesn’t offer the features you want, ask the company to create them.

What do consumers experience in the showroom that could be experienced on your website? What special steps do you take for your showroom visitors that could be tied into your website, using technology? This might mean enhancing your website to with a new functionality, integration or targeting capability. Think about your pricing, sales, financing or delivery process and properly reflect it online in your lead generation strategy.

YOU HAVE LOTS OF OPTIONS

As you continue your hunt for the perfect interactive lead generation strategy, recognize that you have a nearly infinite number of options from which to choose. There’s no need to rush when it comes to implementing a lead generation tool onto your website. Whether you choose to leverage a third-party tool or seek the help of a coder or website designer to create one, you need to make sure it suits your dealership’s current needs.

“By extending the

amount of time a customer spends interacting with you on your website, you are actually “warming up” the lead and helping drive the consumer to your dealership to buy.”

RUSS CHANDLER

Product Marketing Manager at PERQ LLC Russ has more than 11 years of experience in auto sales, dealership digital marketing and technology product sales. In his current job, he leads the sales and marketing of automotive apps powered by FATWIN for PERQ, a consumer engagement technology provider.

FEBRUARY 2016

CAR BIZ TODAY

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31

DEALERS, GMs, SALESPEOPLE, SERVICE MANAGERS, F&I MANAGERS, MARKETING DIRECTORS, BDC MANAGERS AND ALL OTHER DEALERSHIP PERSONNEL Check out CBTNEWS.com for news, information, best practices, training tips from the nation’s top automotive trainers, in-depth interviews with industry experts and more.

It’s completely FREE to all dealership personnel!

Roger Penske Owner of Team Penske, The Penske Corp.

Mike Jackson Chairman, CEO & President of AutoNation, Inc.

Sandy Schwartz President, Cox Automotive

Nick Saban Head Football Coach, Alabama Crimson Tide

Mark Fields President & CEO, Ford Motor Company

Jared Rowe Division President, Media, Cox Automotive

Dale Pollak Founder, vAuto | Senior VP, Cox Automotive

Craig Monaghan President and CEO, Asbury Automotive Group

Bill Fox 2015 NADA Chairman

Jeff Dyke Execurive Vice President, Sonic Automotive

Joe Verde President, Joe Verde Sales & Management Training, Inc.

Alan Mulally Former President and CEO, Ford Motor Company

In addition to our daily newscasts and eNewsletters, our monthly magazine, Car Biz Today, is your trusted source for the latest news and trends in the retail automotive industry.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT CBTNEWS.COM A MEMBER OF THE CBT AUTOMOTIVE NETWORK

DEALERS, GMs, SALESPEOPLE, SERVICE MANAGERS, F&I MANAGERS, MARKETING DIRECTORS, BDC MANAGERS AND ALL OTHER DEALERSHIP PERSONNEL Check out CBTNEWS.com for news, information, best practices, training tips from the nation’s top automotive trainers, in-depth interviews with industry experts and more.

It’s completely FREE to all dealership personnel!

Roger Penske Owner of Team Penske, The Penske Corp.

Mike Jackson Chairman, CEO & President of AutoNation, Inc.

Sandy Schwartz President, Cox Automotive

Nick Saban Head Football Coach, Alabama Crimson Tide

Mark Fields President & CEO, Ford Motor Company

Jared Rowe Division President, Media, Cox Automotive

Dale Pollak Founder, vAuto | Senior VP, Cox Automotive

Craig Monaghan President and CEO, Asbury Automotive Group

Bill Fox 2015 NADA Chairman

Jeff Dyke Execurive Vice President, Sonic Automotive

Joe Verde President, Joe Verde Sales & Management Training, Inc.

Alan Mulally Former President and CEO, Ford Motor Company

In addition to our daily newscasts and eNewsletters, our monthly magazine, Car Biz Today, is your trusted source for the latest news and trends in the retail automotive industry.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT CBTNEWS.COM A MEMBER OF THE CBT AUTOMOTIVE NETWORK

MANAGEMENT

“Many GMs spend

thousands of dollars

This general manager needs to focus on keeping his own training, not just his people’s training, relevant and current.

a month for digital marketing but don’t know how to understand if their vendors did a good job.”

no idea what he or she is talking about. They begin the conversation saying, “Ok, here is what we have to do, we have to adjust some of our traditional marketing, we have to optimize our website, we have to get our SEM in place,” and the GM will say, “OK that sounds good,” but they really don’t understand what that means.

By truly getting trained, a GM can now bounce ideas back and forth off of each other and begin to implement a plan of action.

GP: Why don’t more general managers go to conferences or learn enough to have these conversations? Are they intimidated? Is it because they feel that they have to know as much as that employee? What is the hesitation?

What is the

BIGGEST SKILL Needed by Successful GMs Today?

Knowing Someone who Understands Google Analytics Isn’t Enough!

BY GLENN PASCH

T

he question was posed to me, ‘What skills are needed today for a general manager that were not needed 10 or more years ago?’ I have my opinions but I decided to interview Steve Stigliano, former general manager of Gold Coast Cadillac in Eatontown NJ for his opinion.

Here is some of our conversation.

Glenn Pasch: “Steve, so how long were you a GM?” Steve Stigliano: “I was a GM for the last six or so years. Prior to that, I was a general sales manager and before that a business development manager. I have been in the automotive business for over 13 years.”

GP: “So, you were around right at the beginning of the Internet becoming a growing part of dealerships?”

34

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

SS: Correct. When all the dealers were hoping the Internet was a passing fad. Remember everyone was fighting it and wanting it to go away, that’s when I began. Some industry friends suggested to me that I had to focus on “everything Internet” because that’s the way this industry is going, so I embraced it. This was at the time where the Internet manager was the person sitting in a corner with a computer answering leads because they knew how to type. I took over that job and then moved on to Business Development Manager (BDM) in a bigger dealership and continued to move up.

and twenty groups and many know the right buzzwords but when you really drill down a little bit they have a glazed look in their eye like, “I’m not really sure about that.”

Second, you must combine the understanding of your digital marketing with really getting your entire staff to understand that people walking in the door are Internet shoppers, for both service and sales. Before these customers walk in they have done a lot of research and we can’t treat them like we did in the past. You have to continually train your staff properly to handle these customers in a new way.

SS: I think there are a couple things that some people may not have thought of. When general managers are in the business for 10 to 20 years they have worked their way up through the ranks to get to this position. Many of them are not that tech savvy. They may be great salespeople or can tear apart a financial statement by just looking at it but they are not really tech people and they can get intimidated by all of the terminology.

I just think they’ve gotten burned so often and spent so much money on training that yielded no results whatsoever that they tend not to go down that same road again. But then they feel obligated to send their Internet or digital manager to a conference because that’s what I’m supposed to do and that’s how they’re going to get trained.

Maybe they will return with a nugget of great information for us.

GP: So fast-forward to today. In your opinion what’s the one skill that general managers need to know that is different from the past in order for them to be successful?

GP: So the issue seems to be that when the employee returns the GMs haven’t taken the time to understand what the employee learned, how to implement the new idea and most importantly how to measure it.

SS: Truly understanding their marketing budget in regards to the digital side of it. I’ve spoken to a lot of other general managers at conferences

SS: That is exactly what I meant. It has to start from the top down. You can send someone to a conference but then they come back and you have

to manage a job they never did before. The GMs are more comfortable with conversations and inspection of results in other departments because they did those jobs previously in their climb up to the General Manager position. This type of marketing or position is a whole new ballgame that they don’t know.

So how do we as an industry make it understandable or easy to communicate to the general managers that they don’t need to do the digital manager’s job? They don’t need to go into analytics or they don’t have to know how to go to the backend of the website but they have to understand enough to monitor results.

I like to use this analogy. If a dealer sent someone to the auction to buy cars for the dealership, upon their return they would sit down and inspect what was purchased and for what price. Correct?

SS: Correct.

GP: But many GMs spend thousands of dollars a month for digital marketing but don’t know how to understand if their vendors did a good job.

GP: In my experience, most General Managers will focus on training their staff by sending them to a conference or bringing in a consultant to help train them on the new internet shopper but they don’t focus on their own education.

SS: If the general managers are truly invested in getting their people trained they have to understand that the first step in the process is getting themselves trained properly.

A GM must be Internet savvy, not only to better run the dealership, but to relate to his customers who are using the Internet to shop for cars.

How do we help dealers understand what questions to ask or where to turn for the education they need?

So they hire someone to do the job but because many GMs have a Type A personality, like I do, we feel we should know everything about the job. What we should be doing is getting a solid understanding of the marketing manager’s job and what the terminology really means. Not just knowing the words but understanding the terminology drilling a little deeper. This is the struggle GMs deal with.

Do I dive in or ignore this new part of the job.

GP: What I am hearing, is that a GM needs to get to an understanding of what that digital marketing person or vendor does in the same manner that they would when they’re talking to their used car manager on correct pricing or talking to a GSM about sales, leads, front end gross etc.

SS: Exactly.

GP: To that point, even without considering it being a “techy” position, leadership now has TO SEE MORE FROM GLENN PASCH GO TO CBTNEWS.COM

SS: I think conferences have some good information. I think they’re necessary for the industry and I think there are other things that they can do as well. Companies like PCG are now providing online video workshops. You have some that are specifically targeting the general manager telling them, ‘Here are the things that you need to understand as a general manager today’.

You just said correctly that a GM does not have to be able to open up Google Analytics and understand all the numbers that are associated in Google

Analytics but you have to be able to sit down and have a conversation about Google Analytics with your marketing director or your vendor whomever that may be.

Those type of targeted workshops whether they be physical workshops or an online workshop like PCG has, those I think are critical and frankly yours are the only thing out there like it at the moment.

Those online workshops are the things that are going to appeal to the general manager because they could do it at their own pace. They can do it in the anonymity of their office without feeling like they are sitting amongst a bunch of techy people and maybe feeling a little stupid that they don’t know this stuff.

So those are things that I think will really allow somebody to sit back who hasn’t had the experience on the digital side because they have been in the business for 20 or 30 years or whatever the timeframe is and allow them to take a step back and say I can learn this. This type of education is critically important for the success of a general manager today.

GP: Well thank you Steve. I appreciate it.

“You must combine the understanding of your digital marketing with really getting your entire staff to understand that people walking in the door are Internet shoppers, for both service and sales.”

GLENN PASCH

CEO of PCG Digital Marketing Glenn is a trainer at heart. He is a highly sought-after speaker, writer, coach and operations strategist, as well as a customer service fanatic. He has spoken throughout the U.S. and Canada, educating audiences on a variety of topics including business leadership, change management, digital marketing and the impact of this new technology on culture, business and society. Visit the website www.pcgdigitalmarketing.com

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

35

MANAGEMENT

“Many GMs spend

thousands of dollars

This general manager needs to focus on keeping his own training, not just his people’s training, relevant and current.

a month for digital marketing but don’t know how to understand if their vendors did a good job.”

no idea what he or she is talking about. They begin the conversation saying, “Ok, here is what we have to do, we have to adjust some of our traditional marketing, we have to optimize our website, we have to get our SEM in place,” and the GM will say, “OK that sounds good,” but they really don’t understand what that means.

By truly getting trained, a GM can now bounce ideas back and forth off of each other and begin to implement a plan of action.

GP: Why don’t more general managers go to conferences or learn enough to have these conversations? Are they intimidated? Is it because they feel that they have to know as much as that employee? What is the hesitation?

What is the

BIGGEST SKILL Needed by Successful GMs Today?

Knowing Someone who Understands Google Analytics Isn’t Enough!

BY GLENN PASCH

T

he question was posed to me, ‘What skills are needed today for a general manager that were not needed 10 or more years ago?’ I have my opinions but I decided to interview Steve Stigliano, former general manager of Gold Coast Cadillac in Eatontown NJ for his opinion.

Here is some of our conversation.

Glenn Pasch: “Steve, so how long were you a GM?” Steve Stigliano: “I was a GM for the last six or so years. Prior to that, I was a general sales manager and before that a business development manager. I have been in the automotive business for over 13 years.”

GP: “So, you were around right at the beginning of the Internet becoming a growing part of dealerships?”

34

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

SS: Correct. When all the dealers were hoping the Internet was a passing fad. Remember everyone was fighting it and wanting it to go away, that’s when I began. Some industry friends suggested to me that I had to focus on “everything Internet” because that’s the way this industry is going, so I embraced it. This was at the time where the Internet manager was the person sitting in a corner with a computer answering leads because they knew how to type. I took over that job and then moved on to Business Development Manager (BDM) in a bigger dealership and continued to move up.

and twenty groups and many know the right buzzwords but when you really drill down a little bit they have a glazed look in their eye like, “I’m not really sure about that.”

Second, you must combine the understanding of your digital marketing with really getting your entire staff to understand that people walking in the door are Internet shoppers, for both service and sales. Before these customers walk in they have done a lot of research and we can’t treat them like we did in the past. You have to continually train your staff properly to handle these customers in a new way.

SS: I think there are a couple things that some people may not have thought of. When general managers are in the business for 10 to 20 years they have worked their way up through the ranks to get to this position. Many of them are not that tech savvy. They may be great salespeople or can tear apart a financial statement by just looking at it but they are not really tech people and they can get intimidated by all of the terminology.

I just think they’ve gotten burned so often and spent so much money on training that yielded no results whatsoever that they tend not to go down that same road again. But then they feel obligated to send their Internet or digital manager to a conference because that’s what I’m supposed to do and that’s how they’re going to get trained.

Maybe they will return with a nugget of great information for us.

GP: So fast-forward to today. In your opinion what’s the one skill that general managers need to know that is different from the past in order for them to be successful?

GP: So the issue seems to be that when the employee returns the GMs haven’t taken the time to understand what the employee learned, how to implement the new idea and most importantly how to measure it.

SS: Truly understanding their marketing budget in regards to the digital side of it. I’ve spoken to a lot of other general managers at conferences

SS: That is exactly what I meant. It has to start from the top down. You can send someone to a conference but then they come back and you have

to manage a job they never did before. The GMs are more comfortable with conversations and inspection of results in other departments because they did those jobs previously in their climb up to the General Manager position. This type of marketing or position is a whole new ballgame that they don’t know.

So how do we as an industry make it understandable or easy to communicate to the general managers that they don’t need to do the digital manager’s job? They don’t need to go into analytics or they don’t have to know how to go to the backend of the website but they have to understand enough to monitor results.

I like to use this analogy. If a dealer sent someone to the auction to buy cars for the dealership, upon their return they would sit down and inspect what was purchased and for what price. Correct?

SS: Correct.

GP: But many GMs spend thousands of dollars a month for digital marketing but don’t know how to understand if their vendors did a good job.

GP: In my experience, most General Managers will focus on training their staff by sending them to a conference or bringing in a consultant to help train them on the new internet shopper but they don’t focus on their own education.

SS: If the general managers are truly invested in getting their people trained they have to understand that the first step in the process is getting themselves trained properly.

A GM must be Internet savvy, not only to better run the dealership, but to relate to his customers who are using the Internet to shop for cars.

How do we help dealers understand what questions to ask or where to turn for the education they need?

So they hire someone to do the job but because many GMs have a Type A personality, like I do, we feel we should know everything about the job. What we should be doing is getting a solid understanding of the marketing manager’s job and what the terminology really means. Not just knowing the words but understanding the terminology drilling a little deeper. This is the struggle GMs deal with.

Do I dive in or ignore this new part of the job.

GP: What I am hearing, is that a GM needs to get to an understanding of what that digital marketing person or vendor does in the same manner that they would when they’re talking to their used car manager on correct pricing or talking to a GSM about sales, leads, front end gross etc.

SS: Exactly.

GP: To that point, even without considering it being a “techy” position, leadership now has TO SEE MORE FROM GLENN PASCH GO TO CBTNEWS.COM

SS: I think conferences have some good information. I think they’re necessary for the industry and I think there are other things that they can do as well. Companies like PCG are now providing online video workshops. You have some that are specifically targeting the general manager telling them, ‘Here are the things that you need to understand as a general manager today’.

You just said correctly that a GM does not have to be able to open up Google Analytics and understand all the numbers that are associated in Google

Analytics but you have to be able to sit down and have a conversation about Google Analytics with your marketing director or your vendor whomever that may be.

Those type of targeted workshops whether they be physical workshops or an online workshop like PCG has, those I think are critical and frankly yours are the only thing out there like it at the moment.

Those online workshops are the things that are going to appeal to the general manager because they could do it at their own pace. They can do it in the anonymity of their office without feeling like they are sitting amongst a bunch of techy people and maybe feeling a little stupid that they don’t know this stuff.

So those are things that I think will really allow somebody to sit back who hasn’t had the experience on the digital side because they have been in the business for 20 or 30 years or whatever the timeframe is and allow them to take a step back and say I can learn this. This type of education is critically important for the success of a general manager today.

GP: Well thank you Steve. I appreciate it.

“You must combine the understanding of your digital marketing with really getting your entire staff to understand that people walking in the door are Internet shoppers, for both service and sales.”

GLENN PASCH

CEO of PCG Digital Marketing Glenn is a trainer at heart. He is a highly sought-after speaker, writer, coach and operations strategist, as well as a customer service fanatic. He has spoken throughout the U.S. and Canada, educating audiences on a variety of topics including business leadership, change management, digital marketing and the impact of this new technology on culture, business and society. Visit the website www.pcgdigitalmarketing.com

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

35

POINT OF VIEW

FIFTY YEARS OF WOMEN AND CARS from A to Z Events and cultural shifts keep cruisin’ along

BY ANNE FLEMING

Reflecting back on 50 years of history of women and automobiles is a great way to see the huge industry and cultural shifts that have taken place. Here are a few of the trends and events that changed the marketplace and perceptions.

A Automatic transmissions: One major “shift” D Divorced or never-marrieds: The marriage G in cars over the last 50 years is the widespread acceptance of automatic transmissions. Detroit’s marketing choice was to tout that automatic features made it easier for women to drive.

Regardless, automatic transmissions made it simpler and often times safer to drive, which would especially appeal to busy women with families.

AutoTrader: see Internet

B

rate today is 6.8 per 1,000 with a divorce rate of 3.4 per 1,000 (CDC National Survey of Family Growth).

According to Pew Research, the percentage of women over 25 who have never married rose to 17% in 2012. Over this time period, women have made gains in obtaining higher education. These significant demographic shifts impacted women’s independence.

E

Better employment opportunities: In 1967, only 14.8 million women were employed yearround, full-time, compared to 36.6 million men.

Today 57% of women work. More women in the workforce means more disposable income and certainly required double-income families to have more than one car.

Equal Rights Amendment: The Equal Rights Amendment was introduced in every Congress between 1923 and 1972. It passed on March 22, 1972 and was sent to the states for ratification, but fell short. The ERA states that “equality of rights under the law shall not be denied or abridged by the United States of any state on account of sex.”

C

Edmunds – see Internet

Carbon footprint: The impact of pollution on future generations, as well as the finite nature of carbon fuel, created the demand for electric and hybrid vehicles. According to Evobsession.com, electric car sales increased above 220% in 2013 over 2012; hybrid electric sales increased 26.8%.

Car color: Tastes in car colors change, and we have moved away from the eye-popping colors of the ‘60s and ‘70s. Customers who don’t find the color they like today can customize their vehicles.

Companies like Arlon.com are leading the way to encourage dealers to make this part of their services.

F

Fast Food: McDonald’s began serving fast food in 1955 and never looked back. Fast forward to today, where cars are modified to accommodate the quick and easy food habit, from multiple cup holders to automatic windows, to fold down “trays.”

Fuel Economy: Between 2008 and 2014, gas mileage ratings on new cars improved almost 22%. Better fuel economy, coupled with lower gas prices, means more driving or less money spent on operating a vehicle.

It wasn’t so long ago that women relied on men to help them in purchasing an automobile.

Gas Prices: An oil embargo in 1973 drove prices sky high and led to fuel shortages. Gas lines formed, energy conservation measures were put in place, and the American automotive industry began to be outpaced by Japanese manufacturers who built smaller, more fuel efficient models. The ups and downs of gas prices continue to impact the size and fuel efficiency of cars sold each year.

Global Positioning Systems: The U.S. Department of Defense began developing the GPS in 1973 and it was fully operational by 1995. While everyone benefits from the GPS systems, women especially can feel more confident driving alone or in unfamiliar areas.

H

Health and Wellness Movements: The 1980s were a time of movements toward health and awareness about diseases. Smoking bans became common. Ash trays became a thing of the past and what used to be cigarette lighters are now ports for charging electronic devices.

I

Internet: Increasing and widespread use of the Internet continues to have a growing impact.

Today it is hard to imagine buying a car without first researching car-related web sites and social media. Women rely on car dealer reviews and educational content to help them be wellinformed when they shop at a dealership.

J

Judgement: In 1960, according to Esurance. com, there were 34 million drivers in the U.S, but represented only 39% of the driving population.

Today, there are 105.7 million female drivers compared to 104.3 million men and 57% of women who shop for cars shop alone. Women are more confident to select their own car without depending on someone else’s opinion.

K Kelley Blue Book: see Internet L

Leasing: Leasing is a great opportunity for women. The early 2000s saw a trend of more women under the age of 30 driving a luxury vehicle. By 2010, LeaseTrader.com reported that 51.2% of luxury car leasers under 30 were women, up from 42.6% in 2005.

Gertan / Shutterstock.com

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CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Lee Iacocca: Often at the forefront of automobile innovation, Lee Iacocca joined the Chrysler Corporation in 1979 and began to revitalize the company. In 1984, Chrysler released the minivan,

using previously non-existent front-wheel drive technology to increase the interior space without having to increase exterior dimensions. Chrysler acquired AMC in 1987, bringing the profitable and attractive Jeep brand with it. Both the minivan and the Jeep brand have a strong resonance with women.

Lemon Laws: The federal lemon law, which covers a breach of warranty, was enacted in 1975.

Lemon laws help increase the confidence in a purchase, since a buyer has recourse if a vehicle has major mechanical defects.

M Minivan: The minivan (see Lee Iacocca) has

had a varied reputation and is seen as the vehicle of choice for “soccer moms.” The crossover SUV entered the scene a few decades later, promising a better image.

Mobile devices: According to Statista, there were an estimated 190.5 million smartphone users in the United States and it is expected to rise to 236.8 million by 2019. Mobile devices provide women and families with security as well as safety, and immediate access to information about car dealers.

N

National Highway Traffic Safety Administration: The Highway Safety Act and the National Traffic and Motor Vehicle Safety Act came into being in 1966 and created the National Highway Traffic Safety Administration.

These acts resulted in the mandating of vehicle safety features like seat belts, shatter-resistant windshields and head rests.

O

Oprah Winfrey: In 1986, Oprah Winfrey made talk show history and became a household name influencing women daily. In 2004, Oprah began the 19th season of her show by giving free cars to the studio audience.

P Personal and Self Help Trends: Betty Friedan

was instrumental in the women’s movement. Her 1963 book, The Feminine Mystique, created a resurgence in American feminism.

Q

Qualms: Despite the many changes in women’s culture in the U.S., auto buying still creates anxiety and a feeling of susceptibility. Old sales techniques are changing, but women still have to break the barriers that prevent confident shopping.

R Racial and Civil Change: The 1960s brought

the era of civil change to America. The Equal Credit Opportunity Act of 1974 made it unlawful for any creditor to discriminate against applicants based on race, color, religion, national origin, sex, marital status or age. These acts began to level the playing field for everyone.

S Saturn: GM launched the Saturn brand in 1985

focusing on no haggle pricing, which appealed to women who were intimidated by price negotiation. Saturn stopped production in 2009, but other dealerships adopted the “hassle free” concepts of pricing.

Soccer Mom: By 1996, American car dealers wanted to produce a car for the “soccer mom,” TO SEE MORE FROM ANNE FLEMING GO TO CBTNEWS.COM

Increasingly, women are researching and buying cars by themselves.

Leasing is also popular with women. the middle-class, suburban mother (generally assumed to be stay-at-home, married and white).

By 2012, minivan market share dropped from 8.1% (mid 1990s) to less than 5%, according to Edmunds.com. The stigma attached to minivans contributed to their demise. Crossover SUVs, however, gained ground, increasing in market share year after year.

Social Media: Social media has increased transparency in the purchase of consumer goods, and automobiles are no exception. Car dealer review platforms have created an open place of trust. For women, who write and read reviews more than men, this is an added bonus that can help build confidence and fast-track where they will be buying a car.

T

Television: In 1967, the first Super Bowl is where auto companies found a captive audience.

Then and now, dealer owners have been the pitchmen; today, they are likely to include their wives and daughters who are in the business. This broadens the reach of the advertising to include the women’s market share. Still, the message hasn’t changed much. You are most likely to hear, “We have the best price, best selection and service in town,” rather than speaking to the other needs of consumers, including service and trust.

Title IX: The Title IX of the Education Amendments of 1972 was created to protect people from discrimination based on sex in education programs and activities that receive federal assistance. This, and other efforts to revive the Women’s Rights Movement, helped women step out of traditional cultural roles.

U

Understanding: As the women’s market share in automobiles grew, the need to change sales tactics became more apparent. Women have a different priority list, and being understood by the sales advisor ranks in the top five reasons for purchasing from a particular sales person.

V

Value: Another difference in women and men when shopping for a car is the ranking of price and value in the priorities list. Women still want a good

deal, but place treatment and customer service above price. This is good news to a dealership who wants to instill loyalty in their customers.

W Warranties: The Magnuson-Moss Warranty

Act of 1975 is a federal statute that governs warranties. It requires manufacturers and sellers of consumer products to provide detailed information about warranty coverage, allowing consumers to compare warranties. (see Lemon Laws). Warranties provide peace of mind to many.

Warehouse clubs: Buying clubs like Costco and Sam’s Club have extended their offerings to vehicle purchases, which can provide a less threatening environment for women and families. Buyers can receive additional discounts beyond what is typically negotiated at a dealership.

Women employees at dealerships: In 1966, men dominated the dealership ranks. Today, according to CNW research, women make up 23% of auto dealership’s workforce, but only 1 in 10 sales advisors are women.

X

Generation-X: Gen-X refers to the generation after the Post World War II baby boom. When it came to their car buying habits in 2010, TrueCar. com found they were choosing family-friendly vehicles that were larger and more luxurious.

Y

Generation-Y: Generation-Y, or more commonly called Millennials, are born between 1977 and 1994. By August of 2014, they had purchased 26% of new vehicles that year. Their purchases tended to be compact cars and small SUVs.

Z

Zero-emission vehicle (ZEV): Zero-emission vehicles are those that don’t emit any tailpipe pollutants. As more of these vehicles become available, they will have broad appeal to women and families that are looking to reduce pollution caused by petroleum powered vehicles. The EPA reports that 75% of the carbon monoxide pollution in the U.S. is caused by motor vehicles.

ANNE FLEMING

President of Women-Drivers.com Prior to her involvement in the retail automotive industry, Anne spent 20 years in brand and strategic product development for several international consumer product companies. Her leadership training led to the founding of Women-Drivers.com, which has been featured in the Wall Street Journal, ABC News, USA Today, Working Mother, Smart Money and other national media. Visit her website at Women-drivers.com and follow her on Twitter @Womendrivers.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

37

POINT OF VIEW

FIFTY YEARS OF WOMEN AND CARS from A to Z Events and cultural shifts keep cruisin’ along

BY ANNE FLEMING

Reflecting back on 50 years of history of women and automobiles is a great way to see the huge industry and cultural shifts that have taken place. Here are a few of the trends and events that changed the marketplace and perceptions.

A Automatic transmissions: One major “shift” D Divorced or never-marrieds: The marriage G in cars over the last 50 years is the widespread acceptance of automatic transmissions. Detroit’s marketing choice was to tout that automatic features made it easier for women to drive.

Regardless, automatic transmissions made it simpler and often times safer to drive, which would especially appeal to busy women with families.

AutoTrader: see Internet

B

rate today is 6.8 per 1,000 with a divorce rate of 3.4 per 1,000 (CDC National Survey of Family Growth).

According to Pew Research, the percentage of women over 25 who have never married rose to 17% in 2012. Over this time period, women have made gains in obtaining higher education. These significant demographic shifts impacted women’s independence.

E

Better employment opportunities: In 1967, only 14.8 million women were employed yearround, full-time, compared to 36.6 million men.

Today 57% of women work. More women in the workforce means more disposable income and certainly required double-income families to have more than one car.

Equal Rights Amendment: The Equal Rights Amendment was introduced in every Congress between 1923 and 1972. It passed on March 22, 1972 and was sent to the states for ratification, but fell short. The ERA states that “equality of rights under the law shall not be denied or abridged by the United States of any state on account of sex.”

C

Edmunds – see Internet

Carbon footprint: The impact of pollution on future generations, as well as the finite nature of carbon fuel, created the demand for electric and hybrid vehicles. According to Evobsession.com, electric car sales increased above 220% in 2013 over 2012; hybrid electric sales increased 26.8%.

Car color: Tastes in car colors change, and we have moved away from the eye-popping colors of the ‘60s and ‘70s. Customers who don’t find the color they like today can customize their vehicles.

Companies like Arlon.com are leading the way to encourage dealers to make this part of their services.

F

Fast Food: McDonald’s began serving fast food in 1955 and never looked back. Fast forward to today, where cars are modified to accommodate the quick and easy food habit, from multiple cup holders to automatic windows, to fold down “trays.”

Fuel Economy: Between 2008 and 2014, gas mileage ratings on new cars improved almost 22%. Better fuel economy, coupled with lower gas prices, means more driving or less money spent on operating a vehicle.

It wasn’t so long ago that women relied on men to help them in purchasing an automobile.

Gas Prices: An oil embargo in 1973 drove prices sky high and led to fuel shortages. Gas lines formed, energy conservation measures were put in place, and the American automotive industry began to be outpaced by Japanese manufacturers who built smaller, more fuel efficient models. The ups and downs of gas prices continue to impact the size and fuel efficiency of cars sold each year.

Global Positioning Systems: The U.S. Department of Defense began developing the GPS in 1973 and it was fully operational by 1995. While everyone benefits from the GPS systems, women especially can feel more confident driving alone or in unfamiliar areas.

H

Health and Wellness Movements: The 1980s were a time of movements toward health and awareness about diseases. Smoking bans became common. Ash trays became a thing of the past and what used to be cigarette lighters are now ports for charging electronic devices.

I

Internet: Increasing and widespread use of the Internet continues to have a growing impact.

Today it is hard to imagine buying a car without first researching car-related web sites and social media. Women rely on car dealer reviews and educational content to help them be wellinformed when they shop at a dealership.

J

Judgement: In 1960, according to Esurance. com, there were 34 million drivers in the U.S, but represented only 39% of the driving population.

Today, there are 105.7 million female drivers compared to 104.3 million men and 57% of women who shop for cars shop alone. Women are more confident to select their own car without depending on someone else’s opinion.

K Kelley Blue Book: see Internet L

Leasing: Leasing is a great opportunity for women. The early 2000s saw a trend of more women under the age of 30 driving a luxury vehicle. By 2010, LeaseTrader.com reported that 51.2% of luxury car leasers under 30 were women, up from 42.6% in 2005.

Gertan / Shutterstock.com

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CAR BIZ TODAY FEBRUARY 2016

Lee Iacocca: Often at the forefront of automobile innovation, Lee Iacocca joined the Chrysler Corporation in 1979 and began to revitalize the company. In 1984, Chrysler released the minivan,

using previously non-existent front-wheel drive technology to increase the interior space without having to increase exterior dimensions. Chrysler acquired AMC in 1987, bringing the profitable and attractive Jeep brand with it. Both the minivan and the Jeep brand have a strong resonance with women.

Lemon Laws: The federal lemon law, which covers a breach of warranty, was enacted in 1975.

Lemon laws help increase the confidence in a purchase, since a buyer has recourse if a vehicle has major mechanical defects.

M Minivan: The minivan (see Lee Iacocca) has

had a varied reputation and is seen as the vehicle of choice for “soccer moms.” The crossover SUV entered the scene a few decades later, promising a better image.

Mobile devices: According to Statista, there were an estimated 190.5 million smartphone users in the United States and it is expected to rise to 236.8 million by 2019. Mobile devices provide women and families with security as well as safety, and immediate access to information about car dealers.

N

National Highway Traffic Safety Administration: The Highway Safety Act and the National Traffic and Motor Vehicle Safety Act came into being in 1966 and created the National Highway Traffic Safety Administration.

These acts resulted in the mandating of vehicle safety features like seat belts, shatter-resistant windshields and head rests.

O

Oprah Winfrey: In 1986, Oprah Winfrey made talk show history and became a household name influencing women daily. In 2004, Oprah began the 19th season of her show by giving free cars to the studio audience.

P Personal and Self Help Trends: Betty Friedan

was instrumental in the women’s movement. Her 1963 book, The Feminine Mystique, created a resurgence in American feminism.

Q

Qualms: Despite the many changes in women’s culture in the U.S., auto buying still creates anxiety and a feeling of susceptibility. Old sales techniques are changing, but women still have to break the barriers that prevent confident shopping.

R Racial and Civil Change: The 1960s brought

the era of civil change to America. The Equal Credit Opportunity Act of 1974 made it unlawful for any creditor to discriminate against applicants based on race, color, religion, national origin, sex, marital status or age. These acts began to level the playing field for everyone.

S Saturn: GM launched the Saturn brand in 1985

focusing on no haggle pricing, which appealed to women who were intimidated by price negotiation. Saturn stopped production in 2009, but other dealerships adopted the “hassle free” concepts of pricing.

Soccer Mom: By 1996, American car dealers wanted to produce a car for the “soccer mom,” TO SEE MORE FROM ANNE FLEMING GO TO CBTNEWS.COM

Increasingly, women are researching and buying cars by themselves.

Leasing is also popular with women. the middle-class, suburban mother (generally assumed to be stay-at-home, married and white).

By 2012, minivan market share dropped from 8.1% (mid 1990s) to less than 5%, according to Edmunds.com. The stigma attached to minivans contributed to their demise. Crossover SUVs, however, gained ground, increasing in market share year after year.

Social Media: Social media has increased transparency in the purchase of consumer goods, and automobiles are no exception. Car dealer review platforms have created an open place of trust. For women, who write and read reviews more than men, this is an added bonus that can help build confidence and fast-track where they will be buying a car.

T

Television: In 1967, the first Super Bowl is where auto companies found a captive audience.

Then and now, dealer owners have been the pitchmen; today, they are likely to include their wives and daughters who are in the business. This broadens the reach of the advertising to include the women’s market share. Still, the message hasn’t changed much. You are most likely to hear, “We have the best price, best selection and service in town,” rather than speaking to the other needs of consumers, including service and trust.

Title IX: The Title IX of the Education Amendments of 1972 was created to protect people from discrimination based on sex in education programs and activities that receive federal assistance. This, and other efforts to revive the Women’s Rights Movement, helped women step out of traditional cultural roles.

U

Understanding: As the women’s market share in automobiles grew, the need to change sales tactics became more apparent. Women have a different priority list, and being understood by the sales advisor ranks in the top five reasons for purchasing from a particular sales person.

V

Value: Another difference in women and men when shopping for a car is the ranking of price and value in the priorities list. Women still want a good

deal, but place treatment and customer service above price. This is good news to a dealership who wants to instill loyalty in their customers.

W Warranties: The Magnuson-Moss Warranty

Act of 1975 is a federal statute that governs warranties. It requires manufacturers and sellers of consumer products to provide detailed information about warranty coverage, allowing consumers to compare warranties. (see Lemon Laws). Warranties provide peace of mind to many.

Warehouse clubs: Buying clubs like Costco and Sam’s Club have extended their offerings to vehicle purchases, which can provide a less threatening environment for women and families. Buyers can receive additional discounts beyond what is typically negotiated at a dealership.

Women employees at dealerships: In 1966, men dominated the dealership ranks. Today, according to CNW research, women make up 23% of auto dealership’s workforce, but only 1 in 10 sales advisors are women.

X

Generation-X: Gen-X refers to the generation after the Post World War II baby boom. When it came to their car buying habits in 2010, TrueCar. com found they were choosing family-friendly vehicles that were larger and more luxurious.

Y

Generation-Y: Generation-Y, or more commonly called Millennials, are born between 1977 and 1994. By August of 2014, they had purchased 26% of new vehicles that year. Their purchases tended to be compact cars and small SUVs.

Z

Zero-emission vehicle (ZEV): Zero-emission vehicles are those that don’t emit any tailpipe pollutants. As more of these vehicles become available, they will have broad appeal to women and families that are looking to reduce pollution caused by petroleum powered vehicles. The EPA reports that 75% of the carbon monoxide pollution in the U.S. is caused by motor vehicles.

ANNE FLEMING

President of Women-Drivers.com Prior to her involvement in the retail automotive industry, Anne spent 20 years in brand and strategic product development for several international consumer product companies. Her leadership training led to the founding of Women-Drivers.com, which has been featured in the Wall Street Journal, ABC News, USA Today, Working Mother, Smart Money and other national media. Visit her website at Women-drivers.com and follow her on Twitter @Womendrivers.

FEBRUARY 2016

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37

MARKETING

“While the OEMs are far more in step with dealers in terms of where they spend advertising dollars, the dealer associations appear to be behind the times.”

Co-Op In The

NEW, COMPLEX MARKETING ENVIRONMENT New Consumer Dynamics Affect Ad Dollars

BY GARY GALLOWAY

A

ccording to a recent research study by Borrell Associates and Netsertive, co-op advertising programs in North America will total $36 billion this year, potentially affecting about 12% of all ad spending. The biggest slice belongs to the automotive sector, where OEMs have set aside $6.5 billion to assist franchise dealership marketing efforts.

At $35.5 billion, the automotive industry accounts for the second largest share of digital ad dollars behind general merchandise stores.

The arm-in-arm marketing relationship between OEMs at the highest level and dealerships at the store level seems paramount to an effective advertising plan. And, generally, it is so. OEMs fund, on average, one-third of a dealership’s ad budget through co-op programs and for some dealers, it’s more than half.

Unlike the typical retail advertiser, dealerships take advantage of nearly every co-op dollar made available, underscoring that symbiotic relationship. With $6.5 billion, the automotive co-op bucket will account for roughly 30% of all co-op dollars used in the U.S. and 29% of all dealer advertising.

THE CHANGING MARKETING LANDSCAPE

Maintaining the synchronization between brand manager and advertiser is even more vital than in the past. While times are good – car sales are up 4 % this year and ad budgets up 17 % – the marketing environment has changed radically since 2005.

This new ecosystem involves: ➜ A new competitive dynamic. In the past decade, the number of franchised dealers has dropped 18% while the number of new vehicles sold per dealership has increased 18%. ➜ A new ownership dynamic. That increase in sales and decrease in competition has 38

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

study of where consumers go for information on cars and trucks, digital media dominated the list, accounting for nine of the top 10 most-mentioned sources. Dealer sites and manufacturer sites topped the list, underscoring the importance of having professionally developed and platform-responsive websites and, of course, search-optimized sites.

Advertising is only part of the picture.

Don’t forget key chains, pens and anything else to slap a logo on.

reduced the per-vehicle price of advertising a new car by 21% to $522. It’s the type of efficiency that has attracted investors like Warren Buffett and driven stock prices in public companies like AutoNation, CarMax and Penske Automotive Group. Investors don’t manage dealerships the way family owners did. The ad budget gets closer scrutiny and co-op credits thus hold a higher value. ➜ A new consumer dynamic. More than 90 percent of car purchases start with research via digital media. Empowered consumers are transforming dealerships from “stores” to fulfillment centers. ➜ A digital-centric marketing mindset.

Now that dealers have their own media channel in the form of the Internet, they’re discovering that they need to come up with “news” programming on a regular basis.

Specials and rebates are their versions of breaking news. OEMs and dealers create promotions valued at $2,404 per new vehicle — nearly five times what’s spent on advertising that vehicle — in the form of rebates, loyalty programs, contests and incentives. The amount spent on digitallyfocused promotions is increasing at twice the rate of promotions spending overall. ➜ The rising power of millennials.

Although millennials comprise one-fourth of the adult population, they account for more than half of all adults planning to buy or lease a new car or light truck during

the coming year, according to Scarborough Research.

Responding to these market conditions has required a different marketing plan. The spending mix at the OEM and dealer levels has exhibited a heavy digital tilt. OEMs have increased the digital share of their annual advertising budgets from 31 percent in 2012 to 56 percent this year, and dealers have amped things up even more, from 43 percent to 66 percent. That means that the average dealership has doubled its digital media budget in the past three years, from spending $46,000 on things like search and display advertising and video pre-roll, to nearly $100,000 this year.

DEALER ADVERTISING SPENDING

The new digital dynamic involves not only how they’re searching for a car or truck, but where they’re sitting and what’s in their hands.

More than 150 million Americans own a smart phone, and half of them (75 million) own tablets, according to comScore. Automotive sites have been reporting that between 40% and 50% of their site traffic comes from these mobile devices.

Incredibly, many of those devices are being used on the dealer’s lot.

THE OTHER SIDE OF AUTOMOTIVE MARKETING

Advertising is only part of the picture. The fact is, OEMs and dealerships put billions toward promotional incentives and marketing services.

This can be anything from key chains and pens emblazoned with the manufacturer’s and dealer’s logos to a $2,500 rebate on a car. Edmunds.com, which keeps monthly records on what’s spent, estimated the current level of incentives per new vehicle at $2,404. It varies by class of vehicle, from less than $500 for a compact truck to more than $4,000 for a big car or truck. Contrast that with the average per-vehicle advertising expenditure of $522. Many of these promotional offerings are wrapped into co-op offerings.

Digital marketing is increasing its share of the advertising budget but there’s more than one way to reach your target audiences.

However, co-op support for other “non-advertising” marketing expenditures isn’t always covered. A dealership that spends, for instance, $1 million annually on advertising might spend an additional $500,000 or more on digital marketing services, yet less than 10% of those services might be covered by co-op programs.

OEMs tend to offer co-op support for a few basic digital services, such as Search Engine Optimization (SEO) or digital advertising production fees.

But they rarely offer credit for other digital-marketing expenses such as website hosting, mobile optimization of websites, database management and social media management fees.

Attaining an optimal mix of adverting, marketing services and promotions at the dealer level – supported by a carefully coordinated co-op program by the OEM – is the key to driving a strong, steady flow of leads and walk-ins to a successful dealership.

Make sure you have a mix of advertising, marking and promotions.

GARY GALLOWAY

Automotive Digital Marketing Evangelist Gary Galloway recently joined Netsertive. He is a marketing executive with more than 17 years of experience implementing solutions with a high degree of customer satisfaction, success and profit. An adjunct professor at the UNC-Chapel Hill School of Journalism, Galloway teaches a class on media sales and management/digital marketing. Previously, he was the director of marketing & digital media at Crossroads Automotive Group, where he created and executed monthly interactive marketing campaigns for 19 different retail locations and 30 franchises.

While the OEMs are far more in step with dealers in terms of where they spend advertising dollars, the dealer associations appear to be behind the times. On average, OEMs and dealers spend 61% of their budgets on digital media, while dealer associations spend 10 % there, favoring radio, TV and print media. The upswing in share for online, from 43% in 2012 to 66% in 2015, has come at the expense of newspapers and TV. Just three years ago dealers spent 33% of their budgets on newspaper ads and TV spots; this year they’ll spend 15%.

Where are traditional broadcast television funds going today? Digital video advertising. One-third of dealers expect to decrease traditional television spend in favor of digital video next year, while only 15% expect to spend more on cable/broadcast TV than in previous years.

It’s no wonder that digital has taken up such a large share of media budgets. In a Millward Brown

“At $35.5 billion, the automotive industry accounts for the second largest share of digital ad dollars behind general merchandise stores.”

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

39

MARKETING

“While the OEMs are far more in step with dealers in terms of where they spend advertising dollars, the dealer associations appear to be behind the times.”

Co-Op In The

NEW, COMPLEX MARKETING ENVIRONMENT New Consumer Dynamics Affect Ad Dollars

BY GARY GALLOWAY

A

ccording to a recent research study by Borrell Associates and Netsertive, co-op advertising programs in North America will total $36 billion this year, potentially affecting about 12% of all ad spending. The biggest slice belongs to the automotive sector, where OEMs have set aside $6.5 billion to assist franchise dealership marketing efforts.

At $35.5 billion, the automotive industry accounts for the second largest share of digital ad dollars behind general merchandise stores.

The arm-in-arm marketing relationship between OEMs at the highest level and dealerships at the store level seems paramount to an effective advertising plan. And, generally, it is so. OEMs fund, on average, one-third of a dealership’s ad budget through co-op programs and for some dealers, it’s more than half.

Unlike the typical retail advertiser, dealerships take advantage of nearly every co-op dollar made available, underscoring that symbiotic relationship. With $6.5 billion, the automotive co-op bucket will account for roughly 30% of all co-op dollars used in the U.S. and 29% of all dealer advertising.

THE CHANGING MARKETING LANDSCAPE

Maintaining the synchronization between brand manager and advertiser is even more vital than in the past. While times are good – car sales are up 4 % this year and ad budgets up 17 % – the marketing environment has changed radically since 2005.

This new ecosystem involves: ➜ A new competitive dynamic. In the past decade, the number of franchised dealers has dropped 18% while the number of new vehicles sold per dealership has increased 18%. ➜ A new ownership dynamic. That increase in sales and decrease in competition has 38

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

study of where consumers go for information on cars and trucks, digital media dominated the list, accounting for nine of the top 10 most-mentioned sources. Dealer sites and manufacturer sites topped the list, underscoring the importance of having professionally developed and platform-responsive websites and, of course, search-optimized sites.

Advertising is only part of the picture.

Don’t forget key chains, pens and anything else to slap a logo on.

reduced the per-vehicle price of advertising a new car by 21% to $522. It’s the type of efficiency that has attracted investors like Warren Buffett and driven stock prices in public companies like AutoNation, CarMax and Penske Automotive Group. Investors don’t manage dealerships the way family owners did. The ad budget gets closer scrutiny and co-op credits thus hold a higher value. ➜ A new consumer dynamic. More than 90 percent of car purchases start with research via digital media. Empowered consumers are transforming dealerships from “stores” to fulfillment centers. ➜ A digital-centric marketing mindset.

Now that dealers have their own media channel in the form of the Internet, they’re discovering that they need to come up with “news” programming on a regular basis.

Specials and rebates are their versions of breaking news. OEMs and dealers create promotions valued at $2,404 per new vehicle — nearly five times what’s spent on advertising that vehicle — in the form of rebates, loyalty programs, contests and incentives. The amount spent on digitallyfocused promotions is increasing at twice the rate of promotions spending overall. ➜ The rising power of millennials.

Although millennials comprise one-fourth of the adult population, they account for more than half of all adults planning to buy or lease a new car or light truck during

the coming year, according to Scarborough Research.

Responding to these market conditions has required a different marketing plan. The spending mix at the OEM and dealer levels has exhibited a heavy digital tilt. OEMs have increased the digital share of their annual advertising budgets from 31 percent in 2012 to 56 percent this year, and dealers have amped things up even more, from 43 percent to 66 percent. That means that the average dealership has doubled its digital media budget in the past three years, from spending $46,000 on things like search and display advertising and video pre-roll, to nearly $100,000 this year.

DEALER ADVERTISING SPENDING

The new digital dynamic involves not only how they’re searching for a car or truck, but where they’re sitting and what’s in their hands.

More than 150 million Americans own a smart phone, and half of them (75 million) own tablets, according to comScore. Automotive sites have been reporting that between 40% and 50% of their site traffic comes from these mobile devices.

Incredibly, many of those devices are being used on the dealer’s lot.

THE OTHER SIDE OF AUTOMOTIVE MARKETING

Advertising is only part of the picture. The fact is, OEMs and dealerships put billions toward promotional incentives and marketing services.

This can be anything from key chains and pens emblazoned with the manufacturer’s and dealer’s logos to a $2,500 rebate on a car. Edmunds.com, which keeps monthly records on what’s spent, estimated the current level of incentives per new vehicle at $2,404. It varies by class of vehicle, from less than $500 for a compact truck to more than $4,000 for a big car or truck. Contrast that with the average per-vehicle advertising expenditure of $522. Many of these promotional offerings are wrapped into co-op offerings.

Digital marketing is increasing its share of the advertising budget but there’s more than one way to reach your target audiences.

However, co-op support for other “non-advertising” marketing expenditures isn’t always covered. A dealership that spends, for instance, $1 million annually on advertising might spend an additional $500,000 or more on digital marketing services, yet less than 10% of those services might be covered by co-op programs.

OEMs tend to offer co-op support for a few basic digital services, such as Search Engine Optimization (SEO) or digital advertising production fees.

But they rarely offer credit for other digital-marketing expenses such as website hosting, mobile optimization of websites, database management and social media management fees.

Attaining an optimal mix of adverting, marketing services and promotions at the dealer level – supported by a carefully coordinated co-op program by the OEM – is the key to driving a strong, steady flow of leads and walk-ins to a successful dealership.

Make sure you have a mix of advertising, marking and promotions.

GARY GALLOWAY

Automotive Digital Marketing Evangelist Gary Galloway recently joined Netsertive. He is a marketing executive with more than 17 years of experience implementing solutions with a high degree of customer satisfaction, success and profit. An adjunct professor at the UNC-Chapel Hill School of Journalism, Galloway teaches a class on media sales and management/digital marketing. Previously, he was the director of marketing & digital media at Crossroads Automotive Group, where he created and executed monthly interactive marketing campaigns for 19 different retail locations and 30 franchises.

While the OEMs are far more in step with dealers in terms of where they spend advertising dollars, the dealer associations appear to be behind the times. On average, OEMs and dealers spend 61% of their budgets on digital media, while dealer associations spend 10 % there, favoring radio, TV and print media. The upswing in share for online, from 43% in 2012 to 66% in 2015, has come at the expense of newspapers and TV. Just three years ago dealers spent 33% of their budgets on newspaper ads and TV spots; this year they’ll spend 15%.

Where are traditional broadcast television funds going today? Digital video advertising. One-third of dealers expect to decrease traditional television spend in favor of digital video next year, while only 15% expect to spend more on cable/broadcast TV than in previous years.

It’s no wonder that digital has taken up such a large share of media budgets. In a Millward Brown

“At $35.5 billion, the automotive industry accounts for the second largest share of digital ad dollars behind general merchandise stores.”

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

39

FIXED OPS

How to turn your waiting area into a

CUSTOMER-FRIENDLY, PROFITABLE ROOM Customers Want More than a Chair, Bad Coffee and a TV

BY CHIP WALKER

Welcome to 2016!

We as an industry are coming off one of the best SARR’s years ever, and the 2016 forecast is equally as exciting. Quickly, this means that from the 2008-2010 timeline where we closed over 3000 dealerships with a SARR’s rate at one of the lowest points in years, (right around 10 million units) we are now in very rare air. Over 17 million units, with 3,000 fewer distribution points. What does this mean? Well, your showroom is too small, your shop is too small, your display space is too small, you need more staff everywhere, and most importantly, (hopefully) your sales and profits levels are at levels not enjoyed for some time.

NEXT STEPS TO KEEP CUSTOMERS COMING BACK AND HAPPY Now what?

What can I do to attract and keep more customers and provide a more inviting environment, and change or add to the customer experience inside my building?

While also adding a component of loyalty and familiarity to our location and services? Old problem, right? Maybe, maybe not.

Let’s look hard at today’s sales and service customer profiles. More people demand more services, faster and more convenient. Sure we now have online scheduling for service appointments, electronic recall notices, smart phone support and apps for almost ever function inside our building.

We have designed our buildings with more and more infrastructure to help here.

But, what have we added, does it work? Is it having the effect on our guests, or is it just the flavor of the month that will be gone with the next change of the season? I travel from coast to coast and have been in more dealerships than I count. I am always amazed by what dealers do to attract and keep customers in their store longer or attract them in the first place. A few of the more unusual examples: A high-line ladies dress shop, movie theaters, putting greens, lending library, nail salon, (actually I tried this) and many, many more. So what works, and what are we seeing in the design areas for what does works and what you will be changing in a few months? design areas for what does works and what you will be changing in a few months?

“ I am always amazed by what dealers do to attract and keep customers in their store longer or attract them in the first place.”

“If you open up your space to outside groups and let them hold their meetings or gatherings, this brings several people into your dealership that maybe have never been there before, never considered your location, brand, etc.”

Some dealers contract with local vendors to supply branded food and coffee.

TRENDS YOU MIGHT USE TO INCREASE CUSTOMER SATISFACTION

Here are the trends we are seeing and incorporating into our designs every day:

Community Rooms: This is a larger open room/space where small tables and chairs can be moved to make a “U” shape set up or a traditional class room set up like a lecture hall. Or many small tables can be joined to make a large conference table. The rooms are set up with a small kitchen, microwave, sink with disposal, refrigerator, some even an oven, and all with some type of AV support. Large screen, even a PA system.

A nice relaxing family-style lobby makes the waiting much more pleasant.

Photos courtesy of CFI Design Management Inc.

Who uses this space? Most dealership open this space up for free to community groups, small church groups, service groups the library board, the Masons, Kiwanis, Eagles, Moose. The list goes on and on.

Here is what this does. If you open up your space to outside groups and let them hold their meetings or gatherings, this brings several people into your dealership that maybe have never been there before, never considered your location, brand, etc. Naturally they will become familiar with your layout and services, so you provide each group discounted oil changes, free car wash, donuts for their meeting, you get the idea. Now they are a friend of the dealership and a brand new ambassador for your business. From an internal stand point, this room is also the location for your all company meetings, holiday parties, recognition evens, or kicking off a new model for a ride and drive.

Coffee Shop/Café:

This can be a full blown deal or a nice coffee/tea corner in the guest waiting area. We have put in national franchises like, Dunkin Donuts, Caribou Coffee, Seattle Best, Jimmy John’s and Subway, all of which are incorporated to the guest waiting area and in conjunction with or without a community room or space.

Here is what this does. This feature creates a destination location of an easily recognized food product that is unique and branded and only available through a licensed vendor. The power of this asset is incredible. You not only can offer your guest comfortable seats and areas, but also some comfort food!

40

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TO SEE MORE FROM CHIP WALKER GO TO CBTNEWS.COM

A couple of notes here. Make sure you check with your local food codes and covenants as to what constitutes a commercial kitchen versus assembling food products. The power of the above franchises is they do not “cook” food. No deep frying, stoves, grills, or griddles. Cold cut sandwiches are assembled, donuts are delivered from an existing brick and mortar store and not prepared on site.

Partner with a local store and make them a tenant in your store so they manage their own labor, product, inventory, etc. They can pay you rent for the square footage they occupy or you can do a percentage of sales as your fee. I have seen some dealers even provide the space for free so they can just provide the service/product for their guests.

One note, do not give away the product for free, this is a customer pay feature. You ask, I offer free coffee to my guests now, why would they want to pay for it? Answer: Your coffee stinks. It cannot taste as good as the product that someone is watching and is proud to produce. One additional advantage, your office, shop, sales and even the management staff now have an on-site place to get food and drink without leaving the dealership!

Kid Areas: I am not talking about the 8x8 room you have with the endless loop of Sponge Bob Square pants. I am talking a real McDonald’s, Chuck E. Cheese’s areas with crawling tube, ball pits, rope climbs and video game rooms. Some of the features are glassed enclosed two story areas highly visible from the road and lot. Again you can incorporate the Community Room and offer this space for birthday parties, graduation parties, etc. Here again, this type of commitment comes with a high level of responsibility. All mother and fathers worry about cleanliness in these types of areas, so this means, the space has to be cleaned and inspected every day with a very high level of maintenance to ensure a quality, safe experience for all. This is not an area to go into without a lot of thought, planning, and yes legal advice for liability exposure for the dealership.

As always I am limited by space to continue this piece and I have only scratched the surface of the possibilities of the features and options you can include in your guest’s dealership experiences.

Make sure it fits your style, culture, and guest needs, and you do your homework on what you can and can’t do in your area. Good luck, make your dealership the Community Friendly, Fun and tasty spot to visit.

CHIP WALKER

President of Custom Facilities Inc. Chip has 25 years of construction and design experience and also spent 10 years as COO of one of the largest dealership groups in the Midwest. He also serves as his company’s in-house expert on manufacturer’s imaging programs and on compliance requirements. See the website at www.buildmydealership.com.

FEBRUARY 2016

CAR BIZ TODAY

CBTNews.com

41

FIXED OPS

How to turn your waiting area into a

CUSTOMER-FRIENDLY, PROFITABLE ROOM Customers Want More than a Chair, Bad Coffee and a TV

BY CHIP WALKER

Welcome to 2016!

We as an industry are coming off one of the best SARR’s years ever, and the 2016 forecast is equally as exciting. Quickly, this means that from the 2008-2010 timeline where we closed over 3000 dealerships with a SARR’s rate at one of the lowest points in years, (right around 10 million units) we are now in very rare air. Over 17 million units, with 3,000 fewer distribution points. What does this mean? Well, your showroom is too small, your shop is too small, your display space is too small, you need more staff everywhere, and most importantly, (hopefully) your sales and profits levels are at levels not enjoyed for some time.

NEXT STEPS TO KEEP CUSTOMERS COMING BACK AND HAPPY Now what?

What can I do to attract and keep more customers and provide a more inviting environment, and change or add to the customer experience inside my building?

While also adding a component of loyalty and familiarity to our location and services? Old problem, right? Maybe, maybe not.

Let’s look hard at today’s sales and service customer profiles. More people demand more services, faster and more convenient. Sure we now have online scheduling for service appointments, electronic recall notices, smart phone support and apps for almost ever function inside our building.

We have designed our buildings with more and more infrastructure to help here.

But, what have we added, does it work? Is it having the effect on our guests, or is it just the flavor of the month that will be gone with the next change of the season? I travel from coast to coast and have been in more dealerships than I count. I am always amazed by what dealers do to attract and keep customers in their store longer or attract them in the first place. A few of the more unusual examples: A high-line ladies dress shop, movie theaters, putting greens, lending library, nail salon, (actually I tried this) and many, many more. So what works, and what are we seeing in the design areas for what does works and what you will be changing in a few months? design areas for what does works and what you will be changing in a few months?

“ I am always amazed by what dealers do to attract and keep customers in their store longer or attract them in the first place.”

“If you open up your space to outside groups and let them hold their meetings or gatherings, this brings several people into your dealership that maybe have never been there before, never considered your location, brand, etc.”

Some dealers contract with local vendors to supply branded food and coffee.

TRENDS YOU MIGHT USE TO INCREASE CUSTOMER SATISFACTION

Here are the trends we are seeing and incorporating into our designs every day:

Community Rooms: This is a larger open room/space where small tables and chairs can be moved to make a “U” shape set up or a traditional class room set up like a lecture hall. Or many small tables can be joined to make a large conference table. The rooms are set up with a small kitchen, microwave, sink with disposal, refrigerator, some even an oven, and all with some type of AV support. Large screen, even a PA system.

A nice relaxing family-style lobby makes the waiting much more pleasant.

Photos courtesy of CFI Design Management Inc.

Who uses this space? Most dealership open this space up for free to community groups, small church groups, service groups the library board, the Masons, Kiwanis, Eagles, Moose. The list goes on and on.

Here is what this does. If you open up your space to outside groups and let them hold their meetings or gatherings, this brings several people into your dealership that maybe have never been there before, never considered your location, brand, etc. Naturally they will become familiar with your layout and services, so you provide each group discounted oil changes, free car wash, donuts for their meeting, you get the idea. Now they are a friend of the dealership and a brand new ambassador for your business. From an internal stand point, this room is also the location for your all company meetings, holiday parties, recognition evens, or kicking off a new model for a ride and drive.

Coffee Shop/Café:

This can be a full blown deal or a nice coffee/tea corner in the guest waiting area. We have put in national franchises like, Dunkin Donuts, Caribou Coffee, Seattle Best, Jimmy John’s and Subway, all of which are incorporated to the guest waiting area and in conjunction with or without a community room or space.

Here is what this does. This feature creates a destination location of an easily recognized food product that is unique and branded and only available through a licensed vendor. The power of this asset is incredible. You not only can offer your guest comfortable seats and areas, but also some comfort food!

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A couple of notes here. Make sure you check with your local food codes and covenants as to what constitutes a commercial kitchen versus assembling food products. The power of the above franchises is they do not “cook” food. No deep frying, stoves, grills, or griddles. Cold cut sandwiches are assembled, donuts are delivered from an existing brick and mortar store and not prepared on site.

Partner with a local store and make them a tenant in your store so they manage their own labor, product, inventory, etc. They can pay you rent for the square footage they occupy or you can do a percentage of sales as your fee. I have seen some dealers even provide the space for free so they can just provide the service/product for their guests.

One note, do not give away the product for free, this is a customer pay feature. You ask, I offer free coffee to my guests now, why would they want to pay for it? Answer: Your coffee stinks. It cannot taste as good as the product that someone is watching and is proud to produce. One additional advantage, your office, shop, sales and even the management staff now have an on-site place to get food and drink without leaving the dealership!

Kid Areas: I am not talking about the 8x8 room you have with the endless loop of Sponge Bob Square pants. I am talking a real McDonald’s, Chuck E. Cheese’s areas with crawling tube, ball pits, rope climbs and video game rooms. Some of the features are glassed enclosed two story areas highly visible from the road and lot. Again you can incorporate the Community Room and offer this space for birthday parties, graduation parties, etc. Here again, this type of commitment comes with a high level of responsibility. All mother and fathers worry about cleanliness in these types of areas, so this means, the space has to be cleaned and inspected every day with a very high level of maintenance to ensure a quality, safe experience for all. This is not an area to go into without a lot of thought, planning, and yes legal advice for liability exposure for the dealership.

As always I am limited by space to continue this piece and I have only scratched the surface of the possibilities of the features and options you can include in your guest’s dealership experiences.

Make sure it fits your style, culture, and guest needs, and you do your homework on what you can and can’t do in your area. Good luck, make your dealership the Community Friendly, Fun and tasty spot to visit.

CHIP WALKER

President of Custom Facilities Inc. Chip has 25 years of construction and design experience and also spent 10 years as COO of one of the largest dealership groups in the Midwest. He also serves as his company’s in-house expert on manufacturer’s imaging programs and on compliance requirements. See the website at www.buildmydealership.com.

FEBRUARY 2016

CAR BIZ TODAY

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DEALERS, GMs, SERVICE MANAGERS, FIXED-OPS DIRECTORS, PARTS MANAGERS

PERFORMANCE TRAINING

Check out ServiceDriveToday.com for news, information, best practices, training tips from the nation’s top fixed-ops trainers, in-depth interviews with industry experts and more. It’s completely FREE to all dealership service department personnel!

ARE YOUR

SALES TRAINING EFFORTS PAYING OFF? How to judge and hone your team’s skills on a daily basis.

BY JOHN FAIRCHILD

S

ervice Advisor sales training can be a mishmash of different manufacturer certifications, off-site classes and handed down techniques from management and fellow advisors. Or, as many an advisor will tell you, they may not have gotten any formal service sales training. Even if you have an extensive onsite, online and seminar schedule and your advisors practice the latest techniques, there may still be room for improvement. Right?

The fact is, as a manager, it’s really hard to know if your training efforts and advisor sales techniques are paying off and that your advisors are communicating with your customers in a way in which you would approve and be proud.

TIME IS MONEY, SO STREAMLINE AND PERFECT PROCESSES

As a service manager, time is a precious commodity. We need methods to streamline and perfect our processes to achieve greater success. There is a simple and time-efficient method to assess and then hone the skills of your advisors daily. This is a general approach and these are tactics for any service manager to oversee effective sales training of advisors through first hand interaction. This check and balance method requires that managers role play with advisors and let them present job to YOU, their manager before they take a crack at a live customer.

This coaching and assessment process works by identifying gaps in training so the manager has a perspective that the customer would have in a similar situation.

As managers we can provide the coaching and training and sometimes discipline that is needed to continually improve. From this coaching interaction we can assist advisors to evaluate and polish their skills in a host of different areas. As we assess them we will know what type of additional training and attention the advisor needs for improvement.

Standard process compliance or lack there of will be exhibited.

From discovering and presenting findings from the customer’s prime concern and related needs as well as considering the results of the multipoint inspection, previous history, driving habits and factory required maintenance suggestions will be exposed. We will see the advisors approach to all of

these things and more. We can also tell the subtle, often overlooked, things like the confidence level the advisor is broadcasting and a whole host of subjective things that standardized testing and K.P.I.s will NOT tell us. This is coaching meant to be done with LIVE repair orders and can definitely result in more sales RIGHT NOW. These sessions are meant to be confidence builders for your team and a chance to really get to know what your Advisors come across like.

COACHES SHOULD GET INVOLVED DURING AND AFTER THE MULTIPOINT INSPECTION.

The idea is advisors will have an assigned “coach.”

The coach is usually the service manager, parts & service director or assistant manager. The advisors will get the coach involved with every RO they can AFTER or DURING the point where the Multipoint Inspection and Prime Concern (if there is one) is completed by the tech. During the process each advisor will receive custom, immediate instruction that their manager will follow through with for continued improvement.

For Advisors: Get them to prepare a Prioritized Estimate Presentation based on the recommendations of the tech, previous history and, if needed, physically inspecting the vehicle yourself. Organize your customer presentation with a Prioritized Estimate Sheet and Present it to your assigned coach BEFORE presenting to the customer.

PREP WORK IN “REAL LIFE”

Advisor sets customer up for MPI review by getting assumptive approval to do it FIRST “We will do a FREE Multipoint Vehicle Inspection so if there is ANYTHING ELSE you may need, I can keep you informed, OK?” – GET YOUR ADVISORS: Role Play THEIR word tracks

AN EFFECTIVE PRIORITIZED PRESENTATION INCLUDES THESE ELEMENTS:

➜ Say something positive about the car, overall condition, etc. ➜ Review prime and related items first ➜ Review MPI, Brakes, Tire and Battery every time – GREEN, YELLOW, RED – Emphasize what is good ➜ Review NEEDS NOW & related items

uses the words “NEED” “REQUIRED” “IMMEDIATELY” and/or “SAFETY” when appropriate ➜ Review YELLOW or future maintenance that may make sense to perform now and prepare customer for upcoming service ➜ Give positive outlook scenario of what improvements the customer will receive.

“After that you will only need oil changes and rotations for 15K miles” ➜ Sets up estimate leaving room for unforeseen needs by over estimating cost 10% or so. ➜ Wait to the bottom and give total price first then become silent so the customer can respond with an approval or an objection ➜ Have a plan B and C prepared to immediately go to with the price that can easily be quoted without fumbling ➜ “Advise” by asking again emphasizing importance that SAFETY and/or NEEDED NOW things be done now ➜ Offer to set an in-between appointment to complete postponed work. ➜ Leave the conversation open ended so it’s appropriate to follow up on postponed services next visit “Ok, I will remind you and help you prioritize your needs on future visits”

It doesn’t stop there. Remember to assurance the customer that the vehicle will be in top order after completion.

As a manager this process will help you oversee effective sales training of advisors. You will be sometimes painfully aware of the needs your staff has in the way of sales training. This method will also help you identify lapses in your process flow that need attention so that advisors can you their job effectively. Deficiencies you address will in turn give your advisors greater confidence in your leadership and improved conditions in which to perform.

I promise not everyone is excited about doing role play, especially at first so keep it light and fun and create some prizes based on best presentations and most work upsold.

Good luck and good selling!

JOHN FAIRCHILD

HIGH PERFORMANCE OPERATIONS COACH John has more than 35 years of experience in fixed-operations management and consulting, and trains fixed-ops staff to improve performance and customer service. He started working in auto repair and parts at age 15 and over time held numerous positions at dealerships, including general manager. Visit the websit https://fairchildautomotivesolutions.com.

Jeff Cowan

Jeff Cowan’s Pro Talk

Don Reed

DealerPro Training

Lee Harkins

M5 Management Services, Inc.

Steve Hall

NCM Institute

If profits are to be made in fixed ops, you don’t want to miss an episode of Weekly Tune-up with Jeff Cowan every Tuesday on Service Drive Today.

Jeff is the president of Jeff Cowan’s Pro Talk and is the nation’s authority when it comes to training service advisors and service support staff. On Weekly Tune-up, Jeff interviews the top trendsetters in fixed ops, offering valuable information and insight into driving higher profits.

Featuring daily newscasts, guest interviews, and a monthly magazine with informational columns and articles from experts in the auto service industry, Service Drive Today is your trusted source for the latest news and trends in the automotive fixed-ops field.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT SERVICEDRIVETODAY.COM A MEMBER OF THE CBT AUTOMOTIVE NETWORK

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CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

TO SEE MORE FROM JOHN FAIRCHILD GO TO CBTNEWS.COM

DEALERS, GMs, SERVICE MANAGERS, FIXED-OPS DIRECTORS, PARTS MANAGERS

PERFORMANCE TRAINING

Check out ServiceDriveToday.com for news, information, best practices, training tips from the nation’s top fixed-ops trainers, in-depth interviews with industry experts and more. It’s completely FREE to all dealership service department personnel!

ARE YOUR

SALES TRAINING EFFORTS PAYING OFF? How to judge and hone your team’s skills on a daily basis.

BY JOHN FAIRCHILD

S

ervice Advisor sales training can be a mishmash of different manufacturer certifications, off-site classes and handed down techniques from management and fellow advisors. Or, as many an advisor will tell you, they may not have gotten any formal service sales training. Even if you have an extensive onsite, online and seminar schedule and your advisors practice the latest techniques, there may still be room for improvement. Right?

The fact is, as a manager, it’s really hard to know if your training efforts and advisor sales techniques are paying off and that your advisors are communicating with your customers in a way in which you would approve and be proud.

TIME IS MONEY, SO STREAMLINE AND PERFECT PROCESSES

As a service manager, time is a precious commodity. We need methods to streamline and perfect our processes to achieve greater success. There is a simple and time-efficient method to assess and then hone the skills of your advisors daily. This is a general approach and these are tactics for any service manager to oversee effective sales training of advisors through first hand interaction. This check and balance method requires that managers role play with advisors and let them present job to YOU, their manager before they take a crack at a live customer.

This coaching and assessment process works by identifying gaps in training so the manager has a perspective that the customer would have in a similar situation.

As managers we can provide the coaching and training and sometimes discipline that is needed to continually improve. From this coaching interaction we can assist advisors to evaluate and polish their skills in a host of different areas. As we assess them we will know what type of additional training and attention the advisor needs for improvement.

Standard process compliance or lack there of will be exhibited.

From discovering and presenting findings from the customer’s prime concern and related needs as well as considering the results of the multipoint inspection, previous history, driving habits and factory required maintenance suggestions will be exposed. We will see the advisors approach to all of

these things and more. We can also tell the subtle, often overlooked, things like the confidence level the advisor is broadcasting and a whole host of subjective things that standardized testing and K.P.I.s will NOT tell us. This is coaching meant to be done with LIVE repair orders and can definitely result in more sales RIGHT NOW. These sessions are meant to be confidence builders for your team and a chance to really get to know what your Advisors come across like.

COACHES SHOULD GET INVOLVED DURING AND AFTER THE MULTIPOINT INSPECTION.

The idea is advisors will have an assigned “coach.”

The coach is usually the service manager, parts & service director or assistant manager. The advisors will get the coach involved with every RO they can AFTER or DURING the point where the Multipoint Inspection and Prime Concern (if there is one) is completed by the tech. During the process each advisor will receive custom, immediate instruction that their manager will follow through with for continued improvement.

For Advisors: Get them to prepare a Prioritized Estimate Presentation based on the recommendations of the tech, previous history and, if needed, physically inspecting the vehicle yourself. Organize your customer presentation with a Prioritized Estimate Sheet and Present it to your assigned coach BEFORE presenting to the customer.

PREP WORK IN “REAL LIFE”

Advisor sets customer up for MPI review by getting assumptive approval to do it FIRST “We will do a FREE Multipoint Vehicle Inspection so if there is ANYTHING ELSE you may need, I can keep you informed, OK?” – GET YOUR ADVISORS: Role Play THEIR word tracks

AN EFFECTIVE PRIORITIZED PRESENTATION INCLUDES THESE ELEMENTS:

➜ Say something positive about the car, overall condition, etc. ➜ Review prime and related items first ➜ Review MPI, Brakes, Tire and Battery every time – GREEN, YELLOW, RED – Emphasize what is good ➜ Review NEEDS NOW & related items

uses the words “NEED” “REQUIRED” “IMMEDIATELY” and/or “SAFETY” when appropriate ➜ Review YELLOW or future maintenance that may make sense to perform now and prepare customer for upcoming service ➜ Give positive outlook scenario of what improvements the customer will receive.

“After that you will only need oil changes and rotations for 15K miles” ➜ Sets up estimate leaving room for unforeseen needs by over estimating cost 10% or so. ➜ Wait to the bottom and give total price first then become silent so the customer can respond with an approval or an objection ➜ Have a plan B and C prepared to immediately go to with the price that can easily be quoted without fumbling ➜ “Advise” by asking again emphasizing importance that SAFETY and/or NEEDED NOW things be done now ➜ Offer to set an in-between appointment to complete postponed work. ➜ Leave the conversation open ended so it’s appropriate to follow up on postponed services next visit “Ok, I will remind you and help you prioritize your needs on future visits”

It doesn’t stop there. Remember to assurance the customer that the vehicle will be in top order after completion.

As a manager this process will help you oversee effective sales training of advisors. You will be sometimes painfully aware of the needs your staff has in the way of sales training. This method will also help you identify lapses in your process flow that need attention so that advisors can you their job effectively. Deficiencies you address will in turn give your advisors greater confidence in your leadership and improved conditions in which to perform.

I promise not everyone is excited about doing role play, especially at first so keep it light and fun and create some prizes based on best presentations and most work upsold.

Good luck and good selling!

JOHN FAIRCHILD

HIGH PERFORMANCE OPERATIONS COACH John has more than 35 years of experience in fixed-operations management and consulting, and trains fixed-ops staff to improve performance and customer service. He started working in auto repair and parts at age 15 and over time held numerous positions at dealerships, including general manager. Visit the websit https://fairchildautomotivesolutions.com.

Jeff Cowan

Jeff Cowan’s Pro Talk

Don Reed

DealerPro Training

Lee Harkins

M5 Management Services, Inc.

Steve Hall

NCM Institute

If profits are to be made in fixed ops, you don’t want to miss an episode of Weekly Tune-up with Jeff Cowan every Tuesday on Service Drive Today.

Jeff is the president of Jeff Cowan’s Pro Talk and is the nation’s authority when it comes to training service advisors and service support staff. On Weekly Tune-up, Jeff interviews the top trendsetters in fixed ops, offering valuable information and insight into driving higher profits.

Featuring daily newscasts, guest interviews, and a monthly magazine with informational columns and articles from experts in the auto service industry, Service Drive Today is your trusted source for the latest news and trends in the automotive fixed-ops field.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT SERVICEDRIVETODAY.COM A MEMBER OF THE CBT AUTOMOTIVE NETWORK

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CAR BIZ TODAY FEBRUARY 2016

TO SEE MORE FROM JOHN FAIRCHILD GO TO CBTNEWS.COM

Own an Allstate insurance agency in your dealership and grow your business.

ON THE SET WITH

Bill Wittenmyer of ELEAD1ONE.

Gary Tucker (right) of DealerRater, with Joe Gumm of CBT News.

Clint Burns of The Next Up.

John Fitzpatrick of Force Marketing, with Corinne Lillis of CBT News.

Mark Stringfellow of The Next Up.

Brian Pasch of PCG Consulting.

Brent Albrecht of Friendemic, with Corinne Lillis of CBT News.

Collin Sewell (left) of Sewell Ford, with Joe Gumm of CBT News.

Allstate was first to market with this proven model and can get you up and running quickly with minimal start-up costs.

Author, entrepreneur and trainer Grant Cordone.

Speaker and trainer Cory Mosley (right), with Joe Gumm of CBT News.

Steve Munyan of Hire The Winners.

• • • •

Increases customer touch points Helps improve overall retention Grows revenue and adds to the value, or “blue sky,” of your dealership Offers name-brand recognition of a Fortune 100 company

Learn how the good hands can be good for your business.

Email CarBizToday@Allstate.com.

Todd Gunderson of Next Gear Capital.

Jasen Rice (right) of Lotpop Inc., with Joe Gumm of CBT News.

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CAR BIZ TODAY FEBRUARY 2016

Todd Smith of ActivEngage, with Corinne Lillis of CBT News.

Subject to all terms and conditions as outlined in the Allstate R3001 Exclusive Agency Agreement. Dealer agency opportunity is not available in all states. Allstate agents are not franchisees; rather, they are exclusive agent independent contractors and are not employed by Allstate. Allstate is an equal opportunity company. Allstate Insurance Company, Northbrook, IL. In New Jersey, Allstate New Jersey Insurance Company, Bridgewater, NJ. © 2016 Allstate Insurance Co. allstate.com 1/15.

Own an Allstate insurance agency in your dealership and grow your business.

ON THE SET WITH

Bill Wittenmyer of ELEAD1ONE.

Gary Tucker (right) of DealerRater, with Joe Gumm of CBT News.

Clint Burns of The Next Up.

John Fitzpatrick of Force Marketing, with Corinne Lillis of CBT News.

Mark Stringfellow of The Next Up.

Brian Pasch of PCG Consulting.

Brent Albrecht of Friendemic, with Corinne Lillis of CBT News.

Collin Sewell (left) of Sewell Ford, with Joe Gumm of CBT News.

Allstate was first to market with this proven model and can get you up and running quickly with minimal start-up costs.

Author, entrepreneur and trainer Grant Cordone.

Speaker and trainer Cory Mosley (right), with Joe Gumm of CBT News.

Steve Munyan of Hire The Winners.

• • • •

Increases customer touch points Helps improve overall retention Grows revenue and adds to the value, or “blue sky,” of your dealership Offers name-brand recognition of a Fortune 100 company

Learn how the good hands can be good for your business.

Email CarBizToday@Allstate.com.

Todd Gunderson of Next Gear Capital.

Jasen Rice (right) of Lotpop Inc., with Joe Gumm of CBT News.

44

CBTNews.com

CAR BIZ TODAY FEBRUARY 2016

Todd Smith of ActivEngage, with Corinne Lillis of CBT News.

Subject to all terms and conditions as outlined in the Allstate R3001 Exclusive Agency Agreement. Dealer agency opportunity is not available in all states. Allstate agents are not franchisees; rather, they are exclusive agent independent contractors and are not employed by Allstate. Allstate is an equal opportunity company. Allstate Insurance Company, Northbrook, IL. In New Jersey, Allstate New Jersey Insurance Company, Bridgewater, NJ. © 2016 Allstate Insurance Co. allstate.com 1/15.

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Cable-Dahmer invested in the NCM® Institute General Management Executive Program (GMEP) to grow Amanda’s career. More than an intensive training program, GMEP introduces you to talented professionals like Amanda, developing a nationwide network of friends and colleagues who understand your challenges and are willing to help.

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